3.11.13 Employment Tax Returns

Manual Transmittal

November 07, 2017

Purpose

(1) This transmits a revised guidance of IRM 3.11.13, Returns and Document Analysis, Employment Tax Returns.

Material Changes

(1) Editorial changes have been made throughout the IRM

(2) IRM 3.11.13.1- Program Scope and Objectives- Added internal controls information as outlined in the Internal Control Memo. As a result some information may have been moved or renumbered.

(3) IRM 3.11.13.1.1- Background- Added internal controls information as outlined in the Internal Control Memo. As a result some information may have been moved or renumbered.

(4) IRM 3.11.13.1.2- Authority-Added internal controls information as outlined in the Internal Control Memo. As a result some information may have been moved or renumbered.

(5) IRM 3.11.13.1.3- Responsibilities-Added internal controls information as outlined in the Internal Control Memo. As a result some information may have been moved or renumbered.

(6) IRM 3.11.13.1.4- Program Management and Review- Added internal controls information as outlined in the Internal Control Memo. As a result some information may have been moved or renumbered.

(7) IRM 3.11.13.1.5- Program Control- Added internal controls information as outlined in the Internal Control Memo. As a result some information may have been moved or renumbered.

(8) IRM 3.11.13.1.6- Terms/Definition/Acronyms- Added internal controls information as outlined in the Internal Control Memo. As a result some information may have been moved or renumbered.

(9) IRM 3.11.13.1.7- Related Resources- Added internal controls information as outlined in the Internal Control Memo. As a result some information may have been moved or renumbered.

(10) IRM 3.11.13.4- General information- Added the new changes for Form 943 and Form 944- TY 2017.

(11) IRM 3.11.13.7(2)- Added a new "Note" to the procedures.

(12) IRM 3.11.13.9- Revised Routing Guide Procedures.

(13) IRM 3.11.13.12.2(3)- Revised CCC "F" , "Q" , "T" procedures.

(14) IRM 3.11.13.12.5(3)- Revised third "Then" box to add more delivery companies.

(15) IRM 3.11.13.12.6(1)- Added the words inspect and or receive.

(16) IRM 3.11.13.13.5.1- Entity Perfection- Added Revision 2018 to the procedures.

(17) IRM 3.11.13.14(4)- If/And/Then table- Added Revision 2018 to the procedures.

(18) IRM 3.11.13.15(4)(c)- Form 941-941-PR and Form 941-SS- Revised return perfection and editing procedures.

(19) IRM 3.11.13.15.8(2)- Added Revision 2018 to the procedures.

(20) IRM 3.11.13.15.14(4)- Added Revision 2018 to the procedures.

(21) IRM 3.11.13.15.18(2)- Added Revision 2018 to the procedures.

(22) IRM 3.11.13.15.20- Added Revision 2018 to the table.

(23) IRM 3.11.13.15.22.2- Added Revision 2018 to the procedures.

(24) IRM 3.11.13.15.22.3- Added Revision 2018 to the procedures.

(25) IRM 3.11.13.15.24- Added Revision 2018 to the procedures.

(26) IRM 3.11.13.15.25- Added Revision 2018 to the procedures.

(27) IRM 3.11.13.15.26- Added Revision 2018 to the procedures.

(28) IRM 3.11.13.20- Revised the procedures to add the Schedule R procedures (Form 943).

(29) IRM 3.11.13.20.1(2)- Added Revision 2017 to the table.

(30) IRM 3.11.13.20.4- Added Revision 2017 to the procedures.

(31) IRM 3.11.13.20.6- Added Revision 2017 to the procedures.

(32) IRM 3.11.13.20.7- Added Revision 2017 to the procedures.

(33) IRM 3.11.13.20.8- Added Revision 2017 to the procedures.

(34) IRM 3.11.13.20.10- Added Revision 2017 to the procedures.

(35) IRM 3.11.13.20.11- Added Revision 2017 to the procedures.

(36) IRM 3.11.13.20.13- Added Revision 2017 to the procedures.

(37) IRM 3.11.13.20.14- Added new subsection for Line 12.

(38) IRM 3.11.13.20.15- Added new subsection for Line 13.

(39) IRM 3.11.13.20.17- Added Line 14 to the procedures.

(40) IRM 3.11.13.20.19- Added Revision 2017 to the procedures.

(41) IRM 3.11.13.20.20- Added Revision 2017 to the procedures.

(42) IRM 3.11.13.20.21- Added Revision 2017 to the procedures.

(43) IRM 3.11.13.21- Added the new changes for TY 2017.

(44) IRM 3.11.13.21.8- Revised procedures for Line 7.

(45) IRM 3.11.13.22- Added Revision 2017 to the table.

(46) IRM 3.11.13.22.1- Added Revision 2017 to the procedures.

(47) IRM 3.11.13.22.4- Added Revision 2017 to the procedures.

(48) IRM 3.11.13.22.6(1)- Added Revision 2018 to the procedures.

(49) IRM 3.11.13.22.9- Added new subsection- Line 8 Qualified small business payroll.

(50) IRM 3.11.13.22.10- Added new subsection -Line 9- Total taxes after adjustment and credits.

(51) IRM 3.11.13.22.13- Removed the word "and subsequent" from the title.

(52) IRM 3.11.13.22.13.1- Update the procedures for Line 8 and Line 10.

(53) IRM 3.11.13.22.13.3- Added Revision 2017 to the procedures.

(54) IRM 3.11.13.22.14- Added Revision 2017 to the procedures.

(55) IRM 3.11.13.22.15- Added Revision 2017 to the procedures.

(56) IRM 3.11.13.24.3- Added Revision 2017 to the procedures.

(57) IRM 3.11.13.24.4- Added Revision 2017 to the procedures.

(58) IRM 3.11.13.24.5- Added Revision 2017 to the procedures.

(59) IRM 3.11.13.26- Use of Fax for taxpayer- Update the procedures

(60) IRM 3.11.13.27.(4)c)-Added mail stop for Kansas City Submission Processing Center (KCSPC).

(61) IRM 3.11.13.35- Revised Statute Returns due dates.

(62) IRM 3.11.13.38- Revised TAS procedures.

(63) Update Exhibit 3.11.13-1.

(64) Update Exhibit 3.11.13-2.

(65) Update Exhibit 3.11.13-3.

(66) Update Exhibit 3.11.13-5.

(67) Update Exhibit 3.11.13-6.

(68) Update Exhibit 3.11.13-7.

(69) Update Exhibit 3.11.13-10.

(70) Update Exhibit 3.11.13-17.

(71) Update Exhibit 3.11.13-20.

Effect on Other Documents

IRM 3.11.13, Employment Tax Returns, dated October 27, 2015 is superseded. The following IRM Procedural Updates were incorporated in this revised IRM: IPU 17U0010 issued 01-03-2017, IPU 17U0082 issued, 01-11-2017, IPU 17U0347 issued 02-22-2017, IPU 17U0423 issued 03-03-2017, IPU 17U0627 issued 04-04-2017, IPU 17U0719 issued 04-20-2017, IPU 17U0761 issued 04-28-2017, IPU 17U0830 issued 05-10-2017, 17U1290 issued 08-3-2017, 17U1294 issued 08-31-2017

Audience

Wage & Investment, Submission Processing, Document Perfection Tax Examiners.

Effective Date

(01-01-2018)

Linda J Brown
Director, Submission Processing
Wage and Investment Division

Program Scope and Objectives

  1. This IRM section provides processing instructions for Form 941, Form 941-PR, Form 941-SS, Form 943, Form 943-PR, Form 944, Form 944-SP, Form 945 and Form CT-1 employment tax returns and their related documents.

  2. Purpose : The purpose of Document Perfection is to Code and Perfect (Edit) documents.

  3. Audience: The primary users of the IRM are Submission Processing Code & Edit Supervisory Tax Technician, Lead Tax Technician and Tax Examining Technicians.

  4. Policy Owner : The Director of Submission Processing.

  5. Program Owner: Paper Processing Branch, Business Master File (BMF) Section

  6. Primary Stakeholders: Other areas that may be affected by these procedures include (but not limited to):

    • Accounts Management (AM)

    • Chief Counsel (CC)

    • Compliance

    • Information Technology (IT) Programmers

    • Large Business and International (LB&I)

    • Small Business Self-Employed (SBSE)

    • Statistics of Income (SOI)

    • Submission Processing (SP)

    • Taxpayer Advocate Service (TAS)

    • Tax Exempt and Government Entities (TEGE)

Background

  1. The purpose of Document Perfection is to code and edit (perfect) returns and other documents for input to the Master File (MF) through the Integrated Submission and Remittance Processing System (ISRP) or the Service Center Recognition Image Processing System (SCRIPS). In addition, Document Perfection forwards any other documents or attachments not related to the processing of the returns to the function responsible for handling them.

  2. Document Perfection is not responsible for checking the validity of the documents being processed. The computer will perform these functions after the returns and other documents are coded and edited as prescribed in this Section.

Authority

  1. Authority for these procedures is found in section 6201(a) of the Internal Revenue Code and its corresponding Treasury regulations.

Responsibilities

  1. The Director of Ogden and the Director of the Cincinnati Submission Processing are responsible for monitoring operational performance for the BMF Submission Processing campuses.

  2. The Operations Manager is responsible for monitoring operational performance for their operation.

  3. The Team Manager/Lead is responsible for performance monitoring and ensuring employees have the tools to perform their duties.

  4. The Team Employees are responsible to follow the instructions contained in this IRM and maintain updated IRM procedures.

Program Management and Review

  1. Program Goals: Ensure documents are code and edit ready for transcription.

  2. Program Effectiveness are measured using the following:

    • Embedded Quality Submission Processing (EQSP)

    • Balanced Measures

    • Managerial Reviews

Program Controls

  1. Quality Review conducts a statistical valid sample size review of completed work to ensure IRM guidelines are followed.

Terms/Definitions/Acronyms

  1. For Terms, Definitions and Acronyms, See Exhibit 3.11.13-16 .

Related Resources

  1. The following is a list of related resources:

    • Servicewide Electronic Research Program (SERP)

    • Submission Processing Design Center (SPDC)

    • Integrated Data Retrieval System (IDRS)

♦BMF Consistency♦

  1. The purpose of this initiative is to achieve consistency in the Business Master File (BMF) Code & Edit (C&E) processing IRM's.

  2. Topics for BMF Consistency have been identified and developed as a coordinated effort between Cincinnati, Ogden, and the Paper Processing Branch BMF Code & Edit/Error Resolution System (ERS).

  3. BMF Consistency Subsections are identified by a diamond (♦) symbol before and after the subsection title.

  4. The text in normal print is the common process for BMF returns. The text in BOLD print is form specific and applies to this IRM only.

♦IRM Deviation Procedures♦

  1. IRM deviations must be submitted in writing following instructions from IRM 1.11.2.2.4, When Procedures Deviate from the IRM- and elevated through appropriate channels for executive approval.

General Information

  1. These instructions apply to Employment Tax Returns which will be processed through the Service Center Image Processing System (SCRIPS) or Integrated Submission and Remittance Processing (ISRP) and will interface with the Error Resolution System (ERS).

  2. Form 943: For Tax year 2017- Two new Lines have been added (Line 13 and 14) and the rest of the lines has been renumbered. Line 12 has been renamed to “Qualified small business payroll tax credit for increasing research activities” . The new Line 13 was added to provide the Total taxes after adjustments and credits and Line 14 is now the Total deposits for 2017, including overpayment applied from a prior year and Form 943-X. The employer must attach new Form 8974, Qualified Small Business Payroll Tax Credit for Increasing Research Activities to claim this credit. We also have a new Form 943 (Schedule R). This new form is similar to the existing Schedule R (Form 941), Allocation Schedule for Aggregate Form 941 Filers, which is filed by aggregate filers of Form 941. The Schedule R (Form 943) will be first used in January 2018, when Form 943 filers file their 2017 Form 943 to report 2017 wages and tax information. The Schedule R needs to be attached to Form 943 and 943-PR.

  3. Form 944: For Tax year 2017- Line 8 has been renamed to qualified small business payroll tax credit for increasing research activities (new line). Line 9 is a new line for (Total taxes after adjustments and credits). Line 10 is now Total deposits for this year. The employer must attach new Form 8974, Qualified Small Business Payroll Tax Credit for Increasing Research Activities to claim the research credit. The reserved lines (Line 9a and 9b) have been removed for Tax year 2017.

  4. For Tax year 2017- Two new Lines (Line 11 and Line 12) have been added to the Form 941, Form 941-SS and Form 941-PR. The new Line 11 was added to report the amount of allowable research credit the employer is taking against the employer share of social security tax. The employer must attach new Form 8974, Qualified Small Business Payroll Tax Credit for Increasing Research Activities. These changes were made due to the Protecting Americans from Tax Hikes Act of 2015, enacted on December 18, 2015 (P.L. 114-113), added new IRC sections 41(h) and 3111(f). The new Line 12 was added to provide a total for taxes after adjustments and credits, which is the employer’s tax liability for the quarter. As a result of adding these new lines, all subsequent lines were renumbered.

  5. The social security tax rate is 6.2% each for the employee and the employer. The Medicare tax rate is 1.45% each for the employee and employer. Employers are required to withhold Additional Medicare Tax from wages paid to an employee in excess of $200,000 in a calendar year. The Protecting Americans from Tax Hikes Act of 2015, enacted on December 18, 2015 (P.L. 114-113), amended IRC § 51(c) to extend the work opportunity tax credit through December 31, 2019.

  6. Effective for tax periods beginning after December 31, 2013, the credit for COBRA premium assistance payments cannot be claimed on Form 943 or Form 944. Lines 13a and 13b of Form 943 and Lines 9a and 9b of Form 944 are reserved with a gray shaded area. On Form 941 (Revision 2014), Form 941-PR (Revision 2014) and Form 941 -SS (Revision 2014), lines 12(a) and 12 (b), which were used to claim the COBRA premium assistance credit on prior revisions of these forms, were deleted and the rest of the lines were renumbered.

  7. Starting tax year 2012 and subsequent, Form 944-SS, Employer's ANNUAL Federal Tax Return (American Samoa, Guam, the Commonwealth of the Northern Mariana Islands, and the U.S. Virgin Islands), and Form 944-PR, Planilla para la Declaracion Federal ANUAL del Patrono are obsolete.

    • Employers who would otherwise file a Form 944-SS will file a Form 944 (Employer’s ANNUAL Federal Tax Return), or Form 944-SP, ( Declaracion Federal ANUAL de Impuestos del Patrono o Empleador) for 2012, unless they request to file quarterly Form 941-SS (Employer's QUARTERLY Federal Tax Return (American Samoa, Guam, the Commonwealth of the Northern Mariana Islands, and the U.S. Virgin Islands).

    • Employers who would otherwise file a Form 944-PR will file a Form 944 or For 944- SP for 2012 and subsequent, unless they request to file quarterly Form 941-PR.

    • Employers required to file Form 944 should follow the procedures contained in Rev. Proc. 2009–51 or its successor to request to file Form 941–SS or Form 941–PR.

    • If the taxpayer files a Form 944-SS, Form 944-SP or Form 944-PR (Revision 2012 and prior) for tax year 2012 and subsequent, convert the return to Form 944 (Revision 2015).

  8. -SP The documents to be processed based on the instructions in this chapter are:

    • Form 941, Form 941-PR, and Form 941-SS, Employer's QUARTERLY Federal Tax Return.

    • Effective January 1, 2012, Form 941 M, Employer's Monthly Federal Tax Return became obsolete. If you receive a loose Form 941M after 201112, give the return to your P&A analyst for forwarding to a designated person in Small Business Self Employed (SBSE).

    • Form 943 and Form 943- PR, Employer's Annual Tax Return for Agricultural Employees.

    • Form 944, and Form 944-SP, Employer's ANNUAL Federal Tax Return.

    • Form 945, Annual Return of Withheld Federal Income Tax.

    • Form CT-1, Employer's Annual Railroad Retirement Tax Return.

  9. The documents to be reviewed when attached to documents processed in this chapter:

    Note:

    These documents are detached and routed to Accounts Management for processing.

    • Form 941-X, Adjusted Employer's QUARTERLY Federal Tax Return or Claim for Refund.

    • Form 941-X (PR), Ajuste a la Declaracion Federal TRIMESTRAL del Patrono o Reclamacion de Reembolso.

    • Form 943-X, Adjusted Employer's Annual Tax Return for Agricultural Employees or Claim for Refund.

    • Form 943-X (PR), Ajuste as la Declaracion Federal Anual del Patrono de Empleados Agricolas o Reclamacion de Reembolso.

    • Form 944-X, Adjusted Employer's ANNUAL Federal Tax Return or Claim for Refund.

    • Form 944-X (SP), Ajuste a la Declaracion Federal ANUAL de Impuestos del Patrono o Reclamacion de Reembolso.

    • Form 945-X, Adjusted Annual Return of Withheld Federal Income Tax or Claim for Refund.

    • Form CT-1 X, Adjusted Employer's Annual Railroad Retirement Tax Return or Claim for Refund.

  10. Form 942, Employers Quarterly Tax Return for Household Employees, is occasionally received in C&E. Whenever one is received, please remove from the batch and send to Accounts Management (AM). These returns cannot be processed as Form 942.

Local Desk Procedures

  1. Some Submission Processing Campuses have developed local use Desk Procedures.

  2. Such procedures are only to be used:

    • To supplement existing Headquarters' procedures,

    • To expand Submission Processing Campus Returns and Documents Analysis procedures by incorporating material for other IRMs, Automatic Data Processing (ADP) handbooks, etc.,

    • For local routing procedures, and

    • Are not limited to the examples listed.

  3. Unit managers must have a signed approval on file from the responsible Operations Manager on all Submission Processing Campus Desk Procedures.

  4. All existing local information and procedures issuance should be reviewed by the Operations Manager upon receipt of the new IRM revision to ensure conformance with Headquarters procedures.

Unprocessable Conditions

  1. A return must contain specific items before it is considered processable. Perfect all documents to the extent possible from schedules and other attachments. The specific items needed are:

    • An Employer Identification Number (EIN)

    • A legible name (for name control)

    • A valid tax period

    • Legible tax data, if tax liability is indicated

    • A signature attesting to the perjury statement "Jurat" shown on the document

  2. Conditions that make a document unprocessable are:

    • Name so illegible or incomplete that the name control cannot be determined.

    • Employer Identification Number (EIN) is other than 9 numeric digits which cannot be perfected from information on the return or attachment.

    • The document has two or more different EINs.

    • Taxpayer has stated on the document or attachment that he/she has combined liability for more than one tax period, or more than one type of tax.

      Exception:

      Religious orders can report up to 20 calendar quarters on one return (See Publication 517). Furthermore, Section 218 agreement filers can report retroactive coverage back to the first day of the fifth Calendar Year (CY) preceding the year in which the Section 218 agreement modification is sent to the Commissioner of Social Security. For example, if a modification is sent to the Commissioner in 2011, it can establish coverage back to 2006.

    • Tax data entries on the document are so incomplete, illegible or contradictory that the tax liability cannot be determined.

    • The document has been mis-blocked.

    • Any condition set forth as unprocessable in the sections on processing specific documents.

    • The return is unsigned or signed in the wrong location.

    • The return has only entity data and no other statements, attachments or signature by the taxpayer.

    • The return is for a tax period earlier than the Automatic Processing Date (ADP) date or later than the current return being processed. The first valid period ending - Form 941 - 196203, Form 943 - 196112, Form 944 - 200612 and Form CT-1 - 196203.

  3. Processing Unprocessable Documents when perfection is not possible - On a return with multiple EINs or an illegible name, take the following action:

    1. If the return is a numbered document, asterisk (*) to the left and line through any multiple/partial EIN(s). The record will automatically be placed on the Error Inventory of ERS to be researched on the Key Index File (KIF). If an illegible name is present, edit Action Code (AC) 320 or 352 on the return and prepare Form 4227 and notate "EIN research" for Entity research action.

    2. If the return is unnumbered, request IDRS research. If unable to locate, prepare Form 4227 with notation of "EIN research" and send to Entity.

    3. If the document is unnumbered and the EIN is missing, applied for, pending, etc., send for research per IDRS. If unable to locate EIN, prepare Form 4227 with notation of "EIN research" and route to Entity.

    4. If a return with multiple tax periods or a tax liability is involved, a Computer Paragraph (CP) 51X should be attached.

    IF THEN
    The taxpayer's EIN or name cannot be determined from the attachments, or after research procedures,
    1. Numbered Returns:

      1. Enter Action Code 610 (non-remit) or 611 (remit).

      2. Prepare a Form 4227 indicating to the Rejects unit to void the DLN and properly dispose of the return in accordance with Document 12990 - Records and Information Management Records Control Schedules.

    2. Unnumbered Returns:

      1. Follow the procedure in (3) above

  4. DO NOT send the following unprocessable returns to the "Suspense File" :

    Note:

    Local procedures determine where the "Suspense File" will be maintained.

    • Refund returns that receive an insufficient taxpayer's reply to make them processable or that receive no reply from the taxpayer. Enter Computer Condition Code "X" . However, if the only tax data entries are Failure To Deposit (FTD) credits or liabilities, or balance due/overpayment amounts, resolve the computation in favor of the IRS by entering a sufficient amount on the income tax withholding and total lines to prevent a refund or credit.

    • Returns bearing TC 59X in the left margin, IRC § 6020(b) designation or any other return secured or prepared by a Compliance (Collection) activity.

    • Returns which are void of entity data and signature. If the only entries are figures, give the return to your supervisor for an administrative determination. Likewise, if there is an illegible signature on this type of return where even the first alpha letter of the last name cannot be determined, give it to your supervisor.

  5. All Other Unprocessable Conditions - Initiate correspondence using the Paperless Correspondences Action Code Procedures in Exhibit 3.11.13-17 or Form 13195, unless other instructions are given in the IRM.

♦Correspondence♦

  1. Issue correspondence to resolve any conditions causing the return to be unworkable or unprocessable;

    Note:

    Never correspond on returns prepared by collections, IRC§ 6020(b) or Examination, "Substitute for Return" (SFR)

    .

    Example:

    Do not send Letter 86C when transferring a 6020(b) Form 941-PR from Cincinnati to Ogden.

  2. If the return is incomplete and appears to be a duplicate, give the return to the lead. The lead will initiate research for a Transaction Code (TC) 150 and/or any other research necessary to determine if the return should continue to be processed or other actions taken. A duplicate return could include any of the following:

    • A one page return, with or without a signature.

      Note:

      Instructions for missing page 1 or 2 are found at 3.11.13.15(4) for Form 941 and 3.11.13.22(4) for Form 944.

    • Incomplete returns indicating "Payment Only" .

    • Incomplete returns indicating they have previously e-filed.

    Note:

    This list is not all inclusive. Tax examiners may see other unusual documents that are not addressed in this subsection or in other areas of the IRM.

  3. Examine the return so that all of the conditions can be included in the same correspondence.

    • Form 13195 - 941/943/944/945/CT-1 Correspondence Action Sheet, or a local equivalent of Form 13195, is used to correspond on a return when a condition is present that prevents the return from being processed. See Figure 3.11.13-1

    • Paperless Correspondence Action Code Procedures - edit Action Code 211 followed by a dash (-), then the appropriate Selective Paragraph Codes from Form 13195 and any additional paragraph(s) shown on the 21C letter representing the correspondence issue. See Figure 3.11.13-2 and Exhibit 3.11.13-17 Paperless Correspondence Action Code Procedures

  4. For Form 941, 943, 944, 945 and CT-1 see below:

    IF AND THEN
    Correspondence is needed, Requires a response,
    1. Complete Form 13195 or local equivalent of Form 13195 or Paperless Correspondence indicating the letter number (21C, 86C, 854C, 1382C, 1355C, etc.), Master File Tax (MFT), and the appropriate paragraphs.

      Reminder:

      Within these paragraphs, there may be Fill-ins that the Tax Examiner (TE) will be required to enter, such as, tax period, form number, DLN, etc.

      Note:

      It is now acceptable to receive a missing signature, forms, etc. by fax. Be sure to include the letter paragraph advising the taxpayer of this option when completing Form 13195, or the local equivalent to Form 13195.

    2. Attach Form 13195, or the local equivalent of Form 13195, to the front of the return below the entity area.

    3. Edit AC "211" (First Correspondence), "215" (Correspondence International) "225" (Correspondence for Signature only), or (for OSC only), "226" (International Correspondence for Signature only) on the return.

    4. Continue editing the return.

    5. Leave the return in the batch.

    Correspondence is needed, Does Not require a response,
    1. Complete Form 13195 or local equivalent of Form 13195 indicating the letter number ( 21C, 86C, 854C, 1382C, 1355C, etc.), Master File Tax (MFT), and the appropriate paragraphs.

      Reminder:

      Within these paragraphs, there may be Fill-ins that the tax examiner (TE) will be required to enter, such as, tax period, form number, DLN, etc.

      Note:

      It is now acceptable to receive a missing signature, forms, etc. by fax. Be sure to include the letter paragraph advising the taxpayer of this option when completing Form 13195, or the local equivalent to Form 13195.

    2. Photocopy first page of return and attach the Form 13195 or local equivalent of Form 13195 below the entity area on the front of the return. Be sure the name and address show clearly above the Form 13195 or local equivalent of Form 13195.

    3. Forward the copy to the correspondence area.

    4. Edit an Action Trail (e.g., 21C letter sent) in the lower left corner going vertically up the side of the return.

    5. Finish editing the return and leave in the batch.

    Note:

    There may be additional letters that are exclusive to the Tax Examiner's campus. These letters are for specific forms or conditions where it was deemed necessary for processing. The Tax Examiner should go to his or her Lead or Manager for copies of these letters to facilitate processing.

    Figure 3.11.13-1

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    Figure 3.11.13-2

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♦Definition of Correspondence from Taxpayers♦

  1. Correspondence is all written communications from a taxpayer or his/her representative, excluding tax returns, whether solicited or unsolicited. This includes:

    1. Written communications in response to IRS requests for information or data.

    2. Written communications, including annotated notice responses, that provide additional information or dispute a notice.

    3. A telephone call that results in a written referral or research (Form e-4442, Inquiry Referral).

  2. The key to identifying taxpayer correspondence is to ask the following questions:

    1. Is taxpayer waiting for a response from us?

    2. Is taxpayer waiting for an action to be taken by us?

    3. Is taxpayer asking a question?

    Note:

    A Post-It-Note, Sticky Note, or some other type of note stuck on the return by another function does not constitute correspondence from the taxpayer. For instance the note may state something like the following: "Taxpayer (TP) requests penalties be waived" .

    Do not correspond.

IRS Employee Contacts - RRA 98 IRC 3705(a)

  1. The Restructuring and Reform Act of 1998, IRC § 3705, provides identification requirements for all IRS employees working tax related matters. IRS employees are required to give their name and unique identification number during taxpayer telephone, face to face and written contact. In addition a telephone number is required on all taxpayer correspondence. This will provide taxpayers with enough information to identify an IRS employee who has previously assisted with tax-related matters.

  2. All IRS employees in the field, national, and regional offices who communicate by telephone, correspondence, or face to face with taxpayers or their personal representatives on tax-related matters are required to provide (at a minimum) the following information:

    • Telephone Contact - Their title (e.g. Mr., Mrs., Ms., Miss), last name and badge identification (ID Card) number.,

    • Face to Face Contact - Their title (e.g. Mr., Mrs., Ms., Miss), provide as appropriate during the conversation, their last name and badge identification (ID Card) number.,

    • Correspondence - All correspondence must include a telephone number that taxpayers can call for answers to any questions they may have. In addition, manually generated and handwritten correspondence must have the employee title (e.g. Mr., Mrs., Ms., Miss), last name, and IDRS (Integrated Data Retrieval System) number, letter system number, or their badge identification (ID Card) number.

    • The IDRS number and numbers for some other letter systems are automatically generated. If it is not generated, or a handwritten note is prepared, the badge identification (ID Card) number must be used. Toll-free employees may also provide their location for identification purposes. Faxes to taxpayers on tax-related matters are considered manually-generated correspondence and must include the required information

    • Correspondence, whether sent directly to the taxpayer or to the taxpayer's personal representative, must contain the required information.

  3. When a taxpayer requests to speak with a specific employee who previously handled the inquiry or request, or complains about the level of service previously provided, every attempt should be made to resolve the taxpayer’s inquiry. If the issue cannot be resolved, the employee should refer the inquiry using established procedures to his or her manager.

  4. Correspondex letters will require a specific employee name and telephone number only if the employee initiating the correspondence is in the best position to respond to any questions that the taxpayer may have about the correspondence, or the employee is asking the taxpayer to provide additional case-related information.

  5. Otherwise, if the taxpayer does not need to contact a specific employee, the correspondence needs only an IRS telephone number and standard signature.

  6. Secretaries, receptionists, or other people who answer the telephone in functional offices need to identify themselves and should provide their badge identification (ID Card) number only if they are answering telephones which are routinely used to provide tax or account information.

  7. It is not necessary to repeat the ID card number (badge) on a subsequent contact, when the nature of an employee’s work involves multiple contacts with the same taxpayer, and the employee has given the taxpayer (either by telephone or in-person) their ID card (badge) number on the first contact.

    Note:

    The Taxpayer Bill of Rights (TBOR), was adopted by IRS in June 2014 and provides that taxpayers have the right to receive prompt, courteous and professional assistance in their dealings with the IRS. They are to be spoken to in a way that is easily understood and any correspondence from the IRS must be clear and understandable. They have the right to speak to a supervisor whenever quality service is not received

  8. When contacting taxpayers by telephone, you must be sure you are speaking with the taxpayer or authorized representative before disclosing tax information. See the Taxpayer Authentication guidelines in IRM 21.1.3.2.3, Required Taxpayer Authentication andIRM 21.1.3.2.4, Additional Taxpayer Authentication. Also, before leaving a message on a taxpayer’s answering machine, review IRM 11.3.2.6.1.

♦Routing Guide for Attachments♦

  1. All attachments to the return must be reviewed before the return can be considered processable.

    1. Attachments should only be detached when specifically instructed.

      Note:

      Consider a return or document an "original" if it has an original signature or has been stamped "Process as Original"

    2. Edit Action Trail(s) (e.g., "2848 detached" ) in the lower left margin going vertically up the side of the return.

    Note:

    When a document is detached and routed for processing edit the name and EIN, if not already present. Also, edit the Return Received Date (e.g., "MM/DD/YY" ) in the lower left margin of the detached document before routing.

  2. For all Form 941 returns Code and Edit must ensure the taxpayer's EIN is on all attachments, in case they are separated from the return during processing. If the EIN is not shown on an attachment, (to be processed with the return), edit the last 4 digits of the taxpayer's EIN. Routed attachments should show the Name, full EIN, and a Received Date.

  3. Imperfect Form 941 (Revision 2005 and subsequent) - After detaching a document from the return, and only page(s) 1, 2, and (if applicable) Schedule B and Schedule R remain, Do Not pull the return, leave in "Imperfect" batch.

  4. For all Form 943 returns with the Schedule R attached Code and Edit must ensure the taxpayer EIN is on the Schedule R attachment.

  5. Follow the general guidelines below written for each attachment:

    Note:

    If there is an indication on the document that it is not an original, such as "copy" etc., process as a copy and detach as necessary.

    DOCUMENT DETACH ? ACTION
    CP 207, Proposed FTD Penalty Request for Correct ROFTL Information, NO If the tax period on the return and the CP 207 are the same, send both (return and CP 207) directly to Accounts Management (AM). (Do not process the return).
    CP 207, Proposed FTD Penalty Request for Correct ROFTL Information, YES If the tax period on the return and the CP 207 are different, process the return and send the CP 207 and a copy of the return to Accounts Management (AM).
    CP 161, No Math Error, Balance Due NO Route to Accounts Management.  
    CP 259/959 (Spanish version) NO
    1. Correspondence is attached or taxpayer’s response indicates any of the following:

      • Taxpayer disagrees that they are required to file the return.

      • Only page one of the return is attached.

      • EIN on notice does not match EIN on return.

      • Return requested on notice not the same as return submitted.

      • Taxpayer asking question(s) or requesting IRS take action(s) on their account.

      • Case involves any other IRS action(s) C&E not trained to complete.

    2. Then, Route to Compliance Services Collection Operations (CSCO). Use return address on CP notice;

      • Brookhaven - Stop #662

      • Memphis - Stop #81

      • Philadelphia - 4-N31.142

    3. If none of the above apply, correspondence or written response to the notice is not attached and/or, "599" is notated:

      1. Move the notice to the back of the return.

      2. Continue processing the return.

    Note:

    If the return is unsigned, but the taxpayer has signed the CP notice under the jurat, it is not necessary to correspond for the signature.

     
    CP 259 A through H NO OSPC BMF Entity
    Mail Stop 6273.
     
    CP 276A, NO If the tax period on the return and the CP 276A are the same, send both (return and CP 276A) directly to Accounts Management (AM). (Do not process the return).
    CP 276A, YES If the tax period on the return and the CP 276A are different, process the return and send the CP 276A and a copy of the return to Accounts Management (AM).
    CP 276B, NO If the tax period on the return and the CP 276B are the same, send both (return and CP 276B) directly to Accounts Management (AM). (Do not process the return).
    CP 276B, YES If the tax period on the return and the CP 276B are different, process the return and send the CP 276B and a copy of the return to Accounts Management (AM).
    CP 504/504B, NO
    1. Pull CP 504/504B to the front.

    2. Route notice and return to Accounts Management.

    CP 518, NO
    1. Correspondence is attached or taxpayer’s response indicates any of the following:

      • Taxpayer disagrees that they are required to file the return.

      • Only page one of the return is attached.

      • EIN on notice does not match EIN on return.

      • Return requested on notice not the same as return submitted.

      • Taxpayer asking question(s) or requesting IRS take action(s) on their account.

      • Case involves any other IRS action(s) C&E not trained to complete.

    2. Then, Route to Compliance Services Collection Operations (CSCO). Use return address on CP notice;

      • Brookhaven - Stop #662

      • Memphis - Stop #81

      • Philadelphia - 4-N31.142

    3. If none of the above apply, correspondence or written response to the notice is not attached and/or, "599" is notated:

      1. Move the notice to the back of the return.

      2. Continue processing the return.

    Note:

    If the return is unsigned, but the taxpayer has signed the CP notice under the jurat, it is not necessary to correspond for the signature.

    Letters 112C, 282C, 2255C or 2284C NO
    1. Identify which organization initiated the letter to the taxpayer (e.g., what organization signed the letter?).

    2. Route letters initiated by Accounts Management (AM) to Accounts Maintenance Research (AMRH):

      • Ogden - Mail Stop 6712

      • Cincinnati - Mail Stop 534G

      • Kansas City - Mail Stop N2 6800

    3. Correspondence is attached or taxpayer’s response indicates any of the following:

      • Taxpayer disagrees that they are required to file the return.

      • Only page one of the return is attached.

      • EIN on notice does not match EIN on return.

      • Return requested on letter not the same as return submitted.

      • Taxpayer asking question(s) or requesting IRS take action(s) on their account.

      • Case involves any other IRS action(s) C&E not trained to complete.

    4. Then, Route to Compliance Services Collection Operations (CSCO). Use return address on letter;

      • Brookhaven - Stop #662

      • Memphis - Stop #81

      • Philadelphia - 4-N31.142

    5. If none of the above apply, correspondence or written response to the notice is not attached and/or, "599" is notated:

      1. Move the notice to the back of the return.

      2. Continue processing the return.

    Note:

    If the return is unsigned, but the taxpayer has signed the letter under the jurat, it is not necessary to correspond for the signature.

    Form 433-B, Collection Information Statement for Businesses YES Ogden - route to Collections.
    Cincinnati - route to R&C.
    Kansas City Mail Stop P4 5000.
     
    Form 433-D, Installment Agreement YES Ogden - route to Collections.
    Cincinnati - route to R&C
    Kansas City Mail Stop P4 5000.
     
    General Power of Attorney (POA), submitted on any document other than Form 2848 or 8821, NO Take No Action, Leave the POA attached to the return. Do not route to the CAF function.
    See Form 2848 and 8821.
    Multiple Types of tax, NO Route to Rejects.
    Multiple Tax Periods, NO See IRM 3.11.13.13.5.1Entity Perfection - Tax Period - Form 941, Form 941-PR and 941-SS (Revision 2005 and subsequent).
    Other Tax Returns (original signature), YES
    1. Edit a received date to the detached return.

    2. Route to the appropriate function unless specifically directed otherwise.

    Exception:

    Returns attached to a consolidated return will NOT be detached.

    Petitions in opposition of tax law provisions, YES

    Note:

    No Action Trail needs to be edited when detaching a petition.

    Route to:
    IRS
    ≡ ≡ ≡ ≡ ≡ ≡ ≡
    1111 Constitution Avenue, NW
    Washington, DC 20224
    State Tax Returns, original or copy with original signature, YES Route to Receipt and Control.
    State Tax Returns (Photocopy, facsimile or no signature) No Leave attached.  
    Statement establishing Reasonable Cause for delinquent filing, NO
    1. Issued Letter 1382C.

    2. Continue editing the return.

    Request for Acknowledgement, NO No action required
    Remittance found, NO Immediately hand carry return and remittance to supervisor.
    Request for information or inquiries, YES
    1. Photocopy the attachment if it contains any data necessary to continue processing the return.

    2. Attach the copy to the return.

    3. Route original attachment to the proper office for necessary action.

    Requests for Installment Agreement, YES Ogden - Route to Collections.
    Cincinnati - Route to Receipt and Control
    Kansas City Mail Stop P4 5000.
    Request for Account Adjustment, YES Route to appropriate function. Attachment must contain (or enter if missing):
    • Name,

    • Address,

    • EIN, and

    • Received Date.

    Request for money transfer, YES
    1. If the taxpayer notates transfer of money to the return you are processing:

      1. Prepare Form 3465 to route the request to Accounts Management (AM). Figure 3.11.13-3.

      2. Hold the return for 2 cycles before processing.

    2. If the taxpayer notates transfer of money from the return you are processing:

      1. Prepare Form 3465 to route the request to Accounts Management (AM).

      2. Edit CCC "X" to freeze overpayment.

      3. Continue processing return.

    Request for Forms or Schedules, NO
    1. If requesting current year forms:

      1. Prepare Form 4190.

      2. Forward to National Distribution Center (NDC) for processing.

    2. If Requesting prior year forms:

      1. Prepare Form 6112.

      2. Forward to National Distribution Center (NDC) for processing.

    Note:

    Form 4190 and Form 6112 are generally used for IMF requests. Therefore, enter all BMF requests for forms and/or schedules in the "Write-In" portion of the forms.

    Substitute Letter for Installment Agreement Request, YES Route to Campus Compliance (Collections).
  6. The table below contains routing instructions for specific forms, documents attached to an Employment Return and for loose documents:

    DOCUMENT/FORM DETACH ? ACTION
    CT-1, Employer's Annual Railroad Retirement Tax Return, YES Route to CSPC.  
    CT-1 X, Adjusted Employer's Annual Railroad Retirement Tax Return or Claim for Refund,   See IRM 3.11.13.17Form 94X - Adjusted Employment Tax Return and Claim for Refund.
    SS-4, Application for Employer Identification Number (Entity Control assigned an EIN to the SS-4), YES Route to Entity Control.
    SS-4, Application for Employer Identification Number (Entity Control has not assigned an EIN to the SS-4), NO Route return with Form SS-4 attached to Entity Control.
    SS-16, Certificate of Elections of Coverage Under the Federal Insurance Contributions Act, NO Route return with SS-16 attached to Accounts Management.
    W-2, Wage and Tax Statement (any originals or copies), YES Route to Receipt and Control.
    W-2G, Certain Gambling Winnings YES Route to :
    Social Security Administration
    Wilkes Barre Operations Center
    Wilkes Barre, PA 18769
    W-3, Transmittal of Wage and Tax Statement (any originals or copies), YES Route to Receipt and Control.
    W-4, Employer's Withholding Allowance Certificate, NO Leave attached. No action is required.
    W-11, Employer's Withholding Allowance Certificate, NO Leave attached. No action is required.
    843, Claim for Refund and Request for Abatement, YES
    • Route to Accounts Management (AM) if the tax period shown on the Form 843 is different than the return's tax period.

    • Enter Received Date, and EIN.

    911, Request for Taxpayer Advocate Service Assistance (And Application for Taxpayer Assistance Order), YES Forward to Taxpayer Advocate Service (TAS).
    940, Schedule A, Multi-State Employer and Credit Reduction Information, NO "/" (line through) the Form 940 Schedule A to indicate non-transcribable with Form 941.
    Schedule B, Form 941 - Loose (not attached),   Route to Accounts Management (AM).
    Schedule D, Form 941, YES Route to PSC, Drop Point 4-G08.151
    Schedule R Form 941 - Loose (not attached),   Route to SCRIPS using local procedures.  
    Schedule R, Form 941, Allocation Schedule for Aggregate Form 941 Filers, NO See IRM 3.11.13.15 (16) Form 941, Form 941-PR and Form 941-SS (Revision 2005 and subsequent) Return Perfection and Line Editing.
    941C, Supporting Statement To Correct Information,   Move to the front of the return and route to Accounts Management.  
    941-X, 941-X (PR), Adjusted Employer's QUARTERLY Federal Tax Return or Claim for Refund,   See IRM 3.11.13.17Form 94X - Adjusted Employment Tax Return and Claim for Refund for verification and detaching procedures.
    942, Household Employers Quarterly Tax Return YES Send to AM.
    Schedule R Form 943 - Loose (not attached),   Route to SCRIPS using local procedures.  
    Schedule R Form 943 - (attached), NO See IRM 3.11.13.19 for editing instructions.  
    943-X, 943 X (PR), Adjusted Employer's Annual Federal Tax Return for Agricultural Employees or Claim for Refund,   See IRM 3.11.13.17Form 94X - Adjusted Employment Tax Return and Claim for Refund for verification and detaching procedures.
    944-X, 944 X (SP), Adjusted Employer's ANNUAL Federal Tax Return or Claim for Refund,   See IRM 3.11.13.17Form 94X - Adjusted Employment Tax Return and Claim for Refund for verification and detaching procedures.
    945-X, Adjusted Annual Return of Withheld Federal Income Tax or Claim for Refund,   See IRM 3.11.13.17Form 94X - Adjusted Employment Tax Return and Claim for Refund for verification and detaching procedures.
    1096, Annual Summary and Transmittal of U.S. Information Returns, YES Route to Receipt and Control.
    1099, (any originals), YES Route to Receipt and Control.
    1331, Notice of Adjustment, YES Route to Accounting Function.
    2032, Contract Coverage Under Title II of the Social Security Act YES Route to Entity Control.
    2275, Record Request, Charge and Recharge, NO Take no action.
    2678, Employer/Payer Appointment of Agent, YES Route to Entity for processing.
    2848, Power of Attorney and Declaration of Representative, YES
    1. Ogden - route to Stop 6737
      Cincinnati - route to:
      Internal Revenue Service
      PO Box 268, Stop 8423
      Memphis, TN 38101-0268
      Kansas City - route to Mail Stop P4 5000.

    2. For Private Delivery Carriers:
      Internal Revenue Service
      5333 Getwell Road Stop 8423
      Memphis, TN 38118

    2859, Request for Quick or Prompt Assessment, NO Reject. Hand-Carry to Accounting (NMF) or follow local procedures.
    3198, Special Handling Notice of Examination Case Processing, NO Take no action.
    3244, Payment Posting Voucher, YES Route to Receipt and Control.
    3753, Manual Refund Posting Voucher, NO
    1. Research to determine if TC 840 has posted.

    2. See IRM 3.11.13.12.2 for CCC "O" procedures.

    3870, Request for Adjustment, YES Route to Campus Compliance.
    3893, Re-Entry Document Control, NO See IRM 3.11.13.30 for processing procedures.
    Form 3949 Information Report Referral YES
    • Route Form 3949 according to page 2 of Form 3949 to CI, Exam, Disclosure, etc. following local procedures.

    • Continue processing the return.

     
    Form 3949-A Information Referral YES
    • Route Form 3949-A to the Fresno Service Center.

    • Continue processing the return.

     
    4029, Application for Exemption From Social Security and Medicare Taxes and Waiver of Benefits, YES Send to:
    Social Security Administration,
    Security Records Center,
    Attn.: Religious Exemption Unit,
    P.O. Box 7
    Boyers, PA 16020.
    4219, Statement of Liability of Lender, Surety, or Other Person for Withholding Taxes, YES Route to Compliance (Examination).
    5604, 6020(b) Action Sheet, NO No Action, Support for 6020(b) return.
    8274, Certification by Churches and Qualified Church-Controlled Organizations Electing Exemption from Employer Social Security and Medicare Taxes, YES Route to:
    Ogden Submission Processing Campus
    Entity Control
    Ogden, UT 84201-0027.
    8275-R, Regulation Disclosure Statement, YES Route to Compliance (Examination) - process return.
    8300, Report of Cash Payments Over $10,000 Received in a Trade or Business, YES Route to:
    Internal Revenue Service
    Detroit Computing Center
    PO Box 32621
    Detroit, Michigan 48232.
    8655, Reporting Agent Authorization, YES Route to:
    Accounts Management (AM) Service Campus,
    MS 6748 RAF TEAM,
    1973 North Rulon White Blvd.
    Ogden, UT 84404.
    8821, Tax Information Authorization (TIA), YES
    1. Ogden - Route to Stop 6737
      Cincinnati - Route to:
      Internal Revenue Service
      PO Box 268, Stop 8423
      Memphis, TN 38101-0268
      Kansas City - route to Mail Stop P4 5000.

    2. For Private Delivery Carriers:
      Internal Revenue Service
      5333 Getwell Road Stop 8423
      Memphis, TN 38118

    8822, Change of Address, or Form 8822-B, Change of Address or Responsible Party- Business, is attached,  
    • If the mailing address information is the same and no location address is listed on Line 7 - take no action.

    • If the mailing address information is different and /or location address is listed on Line 7- detach Form 8822 /Form 8822-B and route to Entity Control following local procedures.

    8879, IRS e-file Signature Authorization NO No action required.
    8974-Loose (not attached) Qualified Small Business Payroll Tax Credit for Increasing Research Activities   Route all loose Form 8974 to ICT.  
    8974 Qualified Small Business Payroll Tax Credit for Increasing Research Activities NO See IRM 3.11.13.15.20  
    9465, Installment Agreement Request, or letter substitute, YES Ogden- Route to Collection
    Cincinnati- Route to Receipt and Control.
    Kansas City - route to Mail Stop P4 5000.
    9779, EFTPS Business Enrollment Form, YES Send to:
    EFTPS Enrollment Processing Center
    PO Box 173788
    Denver, CO 80217-3788.
    9948, Referrals To Form NO Leave attached.
    Form 14039-B, Identity Theft Affidavit - Business NO If the envelope is addressed to a specific function or a specific function is indicated by an IRS CP notice or IRS letter, place the Form 14039-B on top and route Form 14039-B and the return to the specific function.

    If either center, Cincinnati or Ogden, receives a Form SS-4 and Form 14039-B route the returns to BMF Entity:
    201 W. Rivercenter Blvd.
    Mail Stop 343
    Covington, KY 41011.

    For the following returns:
    • Loose Form 14039-B.

    • No correspondence attached (e.g., no IRS CP notice or IRS letter).

    • The envelope is not addressed to a specific function.


    Place the Form 14039-B on top of the return and route to the local Image Control Team (ICT).
    Cincinnati - Mail Stop 318G.
    Ogden - Mail Stop 6552.
    Kansas City - route to Mail Stop P4 5000.
     
    Form 14157, Complaint: Tax Return Preparer YES Route to:
    Attn: Return Preparer Office
    401 W. Peachtree Street NW
    Mail Stop 421-D
    Atlanta, Georgia 30308
     

Disposition of Documents

  1. Returns that have been batched, numbered and have been coded and edited should be routed to Data Conversion for transcribing.

  2. Returns that have not been batched, numbered and have not been coded and edited should be transmitted to the Document Perfection function for batching and numbering.

  3. Documents that are withdrawn from processing:

    IF THEN
    Leaving the Submission Processing Campus, Route to Receipt and Control for shipment.
    Not leaving the Submission Processing Campus, Transmit to the appropriate function in the Submission Processing Campus for the required action.

    Note:

    This includes items detached from documents to be processed that require correspondence, accounting, or other action.

Return Editing Guidelines

  1. The following general information can be used when editing Form 941, Form 941-PR, Form 941-SS, Form 943, Form 943-PR, Form 944, Form 944-SP, Form 945, and Form CT-1 returns.

  2. General instructions eliminate repetition of the same instructions for each return. If the general instructions and the specific instructions conflict, follow the specific instructions.

  3. The following criteria should be considered when editing a document:

    1. The return line format on all returns must correspond to the current quarter's or year's (as applicable) revision, or as directed in IRM 3.11.13 procedures for the specific type of return. To convert a return to the current format, you may renumber the lines on the prior revision to the current revision.

    2. Edit all money fields as DOLLARS and CENTS, unless otherwise directed. Editing is not required for any entries less than $1.00.

    3. Edit any misplaced or illegible transcription entry to the proper transcription line, by placing an asterisk (*) to the left of the misplaced or illegible entry and edit to the proper transcription line. Editing of the Entity requires an asterisk (*) to the left and lining through the item that is not to be transcribed.

      Note:

      The entry may have to be computed from other figures on the return or attachment.

    4. If numeric line items contain alpha characters, convert to numerics.

      Exception:

      Notations of "zero" , "none" and "blank" do not need to be converted to a numeric equivalent.

    5. If you can determine that a negative (minus) entry on a transcription line was entered on the incorrect line, asterisk (*) the entry to the left and edit it to the correct line.

  4. When editing a negative entry always edit the entry with a minus (-) sign to the left of the entry.

  5. ALL returns will be edited with the applicable code in a designated area on the return.

    Note:

    Form 941-PR, Form 941-SS, and Form 943-PR, received with a domestic address (address in the 50 states or the District of Columbia) should be processed as a Foreign Return. Do Not convert to a Domestic Return, unless directed by an attachment to the return.

  6. After editing, the return and the schedules or attachments should be in the following sequential order when placed back into the batch This will assist ISRP/SCRIPS during data transcription:

    • Return page 1

    • Return page 2 (if applicable)

    • Schedules, in sequential order, if applicable

    • Any attachments.

  7. All Receipt and Control functions were mandated to locally develop sort procedures for non-remittance returns marked "Amended" or "Corrected" (e.g., not circled). After sorting, these returns are forwarded to Accounts Management (AM) for their consideration as follows:

    IF THEN
    A non-remittance return marked "Amended" or "Corrected" (e.g., not circled) is received within Code and Edit, Do not perfect the return. Forward the return to Accounts Management (AM).
    A non-remittance return marked "Amended" or "Corrected" is circled and received within Code and Edit, Continue to perfect the return using IRM 3.11.13 procedures. Do not forward these to Accounts Management (AM). AM is attempting to re-enter (process) the return as an original.

♦Types of Edit Marks♦

  1. Edit marks are edited on the return for transcription by ISRP or SCRIPS. The editing must be entered in red pen.

  2. The only items edited on the return are those to be transcribed except where specific instructions require editing of a non-transcribed item. Lines are left blank if the entry would be a zero amount unless otherwise instructed.

  3. The original entry on a return is never obliterated, altered, or erased when deleting or correcting an entry. Always exercise care to ensure the original entry remains legible. Perfected entries provide a legible "edit trail" for anyone who may work with the return later.

  4. For a description of specific edit marks, see the tables below:

    EDIT MARKS SCRIPS Form 941 ISRP DESCRIPTION
    Asterisk (*) X X Used to delete tax data or to indicate that an item is not to be transcribed.

    Note:

    The asterisk must be placed to the left of the entry as close as possible.

    Exception:

    An asterisk in the signature box indicates that the signature is on an attachment or is not needed.

    Circle X X Used to remove an entry in a C&E Field Only (i.e. Action Code (AC), Computer Condition Code (CCC), Received Date, Schedule Indicator Code (SIC), Schedule R Indicator (SRI), or Tax Period).

    Note:

    If the taxpayer circles an entry, edit the entry.

    Line Through X X Entity Perfection Only - Used to delete data. Unless otherwise specified, a horizontal line through data will always indicate the data is being deleted from the return.

    Note:

    Always edit an asterisk, as close as possible, to the left of the lined through entry.

    Underline X X Used to identify a Name Control or Edit Mark that is to be transcribed.
    Arrow   X International (OSPC Only) Arrow country or country codes, province code and postal codes to the proper location.
    Check Mark X X Indicates that an entry has been manually math verified and is correct.  
    Minus Sign X X Indicates that the entry is negative.
    Vertical Line or Decimal Point X X Indicates the separation of dollars and cents, if no distinction has been made by the taxpayer.
    Zero, Dash, None, or N/A X X "Zero" , "Dash" , "None" or N/A are considered valid entries except when specific instructions require editing of an entry.
    Edit Marks Made by other IRS Functions X X Edit marks entered by another area (such as Collections, Entity or Accounts Management (AM)) are not to be re-edited except to place the marks in the correct area or to perfect for legibility.

    Note:

    If the edit mark is in orange or pink ink, re-edit using red ink.

    Exception:

    Photocopied Returns

    Photocopied Returns X X Re-edit or underline any valid, black edit marks. See IRM 3.11.13.33, Correspondence Imaging System (CIS) Returns, and IRM 3.11.13.31 Re-Entry Document Procedures  
    "C/O" or "%" X X Indicates the presence of a "In-Care-Of Name" or "Care of Address"
    "/" X X A"/" through the entire page, can be used when deleting a form or schedule that is not to be transcribed; or to indicate information may be on an attached page to make the return complete.
    "/" XX "/$"
    XX represents the two digit foreign country code.
      X
    • ISRP ONLY

      1. Indicates a foreign address. The two digit alpha foreign country code will be preceded by / and followed with /$.

      2. See Document 7475, State and Address Abbreviations, Major City Codes (MCCs), ZIP Codes and Countries. This cannot be used for documents processed via SCRIPS.

Disallowance of Erroneous Adjustment or Other Entries

  1. Place an asterisk (*) (Form 941, Form 941-PR, Form 941-SS, Form 943, Form 943-PR, Form 944, Form 944-SP, Form 945, or Form CT-1) to the left of an adjustment entry if there is an indication the entry is not a true adjustment of income tax withholding or Social Security/Medicare or Railroad Retirement Tax Act ( RRTA) tax liability for a prior period. Rather, the entry represents a payment of an outstanding liability or Failure To Deposit ( FTD). The indication can be in the form of an attachment on the return.

    1. Prepare a Form 3465, Adjustment Request, and route to Accounts Management (AM).

    2. If the taxpayer indicates that a FTD payment has been made on a return which does not provide for such payments, such as Form 8752, the money can be located on a Form 941 module and AM should be notified to transfer the money from the Form 941 module if appropriate. See Figure 3.11.13-3.

    Note:

    Photocopy related materials and attach to the back of the Form 3465 and route to Accounts Management (AM).

    Figure 3.11.13-3

    This is an Image: 33485004.gif
     

    Please click here for the text description of the image.

Non-Taxable Returns With No Line Entries

  1. Process a signed return containing no line entries as a non-taxable return. This includes a signed return with a CP 139 attached or with a notation indicating not liable to file for the quarter such as "No Employees This Quarter" , "No Wages Paid This Quarter" , etc. Edit Schedule Indicator Code (SIC) 1. See Figure 3.11.13-4.

    Note:

    If not signed, follow Signature Correspondence procedures.

    Figure 3.11.13-4

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    Please click here for the text description of the image.

  2. Starting January 1, 2009, a taxpayer filing under IRC § 3509 for "Misclassified Employees" is instructed to file a Non-Taxable Return with a zero on Line 10, write across the top of the return "Misclassified Employees" , complete Part 5 (signature field), and attach Form 941-X to the return. When a Non-Taxable 941 return is received with "Misclassified Employees" written in the top margin and Form 941-X is attached process as follows:

    1. Edit Action Trail "94X to AM"

    2. Edit Computer Condition Code (CCC) "M"

    3. Edit CCC "X" to the return. This will prevent any payment from refunding while the adjustment is being processed.

    4. Detach Form 941-X and route to Accounts Management (AM) on Form 3465. Edit in remarks "3509" .

    Exception:

    If a taxpayer files a Return for "Misclassified Employees" and has tax data, route the return and attachments to Accounts Management.

    Note:

    If Form 941-X is attached, the Form 941 may not have "Misclassified Employee" written across the top of the return, look for an indication the taxpayer is filing under IRC § 3509 on Form 941-X Line 22 on the September 2010 revision. The taxpayer is instructed to check the box to indicate the adjustment involves reclassified workers. When the box is checked follow the procedures above a) - c).

  3. Process a Non-Taxable return with any indication of "Final" , "No longer in business" , "Do not file this form" , "Previously Filed a Final Return" , etc., using the following table:

    IF AND THEN
    Only the Entity information is present on the return and the return is signed, There is an indication of filing a Final Return, Edit SIC 1, as applicable.

    Note:

    If there is not an entry on the "Final date you paid wages" line, do not correspond for the entry (See IRM 3.11.13.12.2 for Computer Condition Code F).

    Only the Entity information is present on the return and there are no attachments containing tax data and the return is NOT SIGNED There is an indication of filing a Final Return or an indication of Previously Filed Final Return (i.e. a date of final wages in a previous quarter)
    1. Research IDRS for status of filing requirement.

    2. If the filing requirement is finalized (closed) or there is no filing requirement for the form being filed; then destroy the return.

    3. If the filing requirement is open process the return and correspond for signature.

    Note:

    Do not destroy the return if it has been secured.

  4. A signature is not required if the taxpayer indicates that they received the wrong type of return, and that another type of return has been filed, providing the following actions are taken before CCC "F" is entered:

    1. Prepare Form 4227 (or Form 6882, IDRS/Master File Information Request), for research to be performed to determine whether the proper filing requirement has been established for the return the taxpayer states was filed. Request on the Form 4227 or 6882 to research for the entity and Master File Transaction (MFT) of the appropriate return.

    2. If research shows a filing requirement for the appropriate return, process the incorrect return as final to turn off the filing requirement.

    3. If research shows that the taxpayer does not have a filing requirement for the return he/she states should be filed, attach the research papers to the invalid return and forward to Entity Control on Form 4227 for filing requirement determination. If the filing requirement is incorrect, Entity Control will change it and notate the change on Form 4227. The return will be sent back to Code and Edit to be converted to the proper return (If the return is unsigned signature correspondence may be required).

♦Foreign Currency♦

  1. For returns completed in other than U.S. currency, process as filed. However, if corresponding for missing/incomplete item(s), include in the letter to resubmit in U.S. currency.

Specific Employment Return Editing

  1. Besides editing marks on return lines, Code and Edit examiners may edit specific codes on a return in a specified location to indicate, for example, special conditions, correspondence, pre-computed penalty and interest, or a received date to a delinquent returns.

  2. Reference to Form 941 Revision 2005 and subsequent that will be processed through SCRIPS will be referred to as SCRIPS Form 941.

♦Action Codes♦

  1. Action Codes are used to indicate whether correspondence, research, or some other action is needed. The Action Code will set the suspense period to be assigned to the return and place the return in the workable or unworkable suspense inventory. See Exhibit 3.11.13-13 for a list of valid Action Codes.

  2. When necessary, a three-digit Action Code will be assigned by the tax examiner (TE).

  3. Edit an Action Code for Form 941, Form 941-PR, Form 941-SS, Form 943, Form 943-PR, Form 944, Form 944-SP, Form 945 and Form CT-1 in the bottom left margin of the return directly below the words "For Privacy Act..." . See Figure 3.11.13-5.

  4. Assign Action Codes in the following priority order:

    1. Action Code 310 (Statute Control). See IRM 3.11.13.34 Statute Returns.

    2. Action Code 320 (Entity Control).

    3. Action Code 4XX.

    4. Action Code 6XX.

    5. Action Code 3XX.

    6. Action Code 2XX (Correspondence).

    Exception:

    When more than one Action Code is needed attach Form 4227. If more than one Action Code of the same priority is required (e.g., 310 and 341), edit the Action Code with the shortest suspense period and attach Form 4227 to indicate the second unprocessable condition. Use Action Code 211, 215, 225, or 226 before Action Code 341 to ensure the return is complete before a manual refund is issued.

    Figure 3.11.13-5

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  5. If more than one Action Code of the same priority is required (e.g., 310 and 341), edit the Action Code with the shortest suspense period and attach Form 4227 to indicate the second unprocessable condition. See Figure 3.11.13-6.

    Note:

    For SCRIPS Perfect returns, If more than one Action Code is needed, edit the second Action Code on Form 4227, pull the return from Perfect batch and request it be merged into an Imperfect batch.

    Figure 3.11.13-6

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    Please click here for the text description of the image.

  6. Edit the following Action Codes when a return cannot be perfected from the information present:

    Action Code Description
    211 ( First Correspondence),
    • Return is illegible, incomplete, or contradictory that it is not acceptable for computer processing.

    • The taxpayer notates on the return or attachment that they are reporting tax for more than one tax period or for more than one type of tax.

    215 (International Correspondence)
    • Return is illegible, incomplete, or contradictory that it is not acceptable for computer processing.

    • The taxpayer notates on the return or attachment that they are reporting tax for more than one tax period or for more than one type of tax.

    225 (Missing Signature Correspondence), Unsigned returns (only issue for correspondence).
    226 (Missing Signature International Correspondence)
    OSPC Only,
    Unsigned foreign returns (only issue for correspondence).
    480 (Early Filed- Suspense), The return is an early filed current return.

    Note:

    A Form 941 filed early may be processed during the quarter shown on the return.

    610 (Renumbered Non-remittance), or
    611 (Renumbered with Remittance),
    A return is mis-blocked (e.g., Form 941 found in an 945 batch of work).
    650 ( International),
    • The return is an international return and must be forwarded to OSPC.

    Note:

    An APO/DPO/FPO address is not considered foreign.

    640 (Void), To delete the assigned DLN on the return (e.g., re-entry returns).
  7. Continue perfecting the return after editing the Action Codes.

♦Computer Condition Codes (CCC)♦

  1. Computer Condition Codes (CCC) are used to identify a special condition or computation to post to the Master File (MF).

  2. Computer Condition Codes (CCC) editing location:

    1. Form 941/PR/SS (Revision 2005 and subsequent), Form 944-SP - edit the CCC at the end of the "You MUST fill out both pages of this form and SIGN it" line.

    2. Form 941/PR/SS (Revision 2004 and prior), Form 943, Form 943-PR, Form 945, and Form CT-1 - edit the CCC in the bottom center margin.

  3. Computer Condition Codes (CCC) description:

    Computer Condition Code (CCC) Title Explanation
    B Exempt Social Security Or Medicare Tax
    • Edit CCC B when Line 4 box (Form 941) or Line 3 box (Form 944) is checked.

    • CCC B is used to indicate that:

      1. The maximum amount of Social Security tax has been paid

      2. Wages for children under 18 years old

      3. Minister wages

      4. Railroad

      5. United Transportation Union

      6. Non-qualified Plan (IRC § 457 plan)

      7. Church Federal Insurance Contributions Act (FICA) Issue (For additional information See IRM 3.11.13.15.5 Form 941 with Notation, "Church FICA Issue"

      8. Foreign Employer with U.S. Employees

    • Form 941 and Form 944:

      1. Edit CCC B when all of these conditions are present:

        1. Line 2 Form 941 or Line 1 Form 944 ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

        2. Line 5a through 5c, (Rev 2012 or prior) or Lines 5a through 5d (Revision 2014 and 2013) Column 1 and 2 (Form 941), or Line 4a through 4c Column 2 (Form 944) are blank, dash, zero (0), none, or "n/a" ,

        3. Line 4 (Form 941) or Line 3 (Form 944) is not checked, but the taxpayer is indicating being exempt from Social Security and/ or Medicare tax on the return or attachment due to one of the conditions in list a-h above.

      2. If the taxpayer indicates or notes EXEMPT, but does not indicate a reason: (Follow the alpha list in priority order)

        1. Review the return and attachments for an Employment Code, Revision October 2010 or prior. If the Form 941 return is a Revision January 2011 or subsequent the Employment Code will not appear on the return. If the Employment Code is a "C" , "F" or "G" , edit CCC "B" and continue to process the return.

        2. If you cannot determine why the taxpayer is claiming to be exempt, or the Employment Code is not shown, then research IDRS (e.g., INOLE) for the Employment Code. If through research you determine the Employment Code is "C" , "F" or "G" , then edit CCC "B" and continue to process the return.

        3. After research, if the Employment Codes cannot be determined or is other than "C" , "F" , or "G" :
          Form 944: edit the Line 1 amount to Line(s) 4a and 4c Column 1.

    D Reasonable Cause for Failing To Pay Timely
    1. Do not edit CCC D if the taxpayer requests abatement for Failing to Pay Timely when the return is submitted.

      • Send Letter 1382C to inform the taxpayer of the proper procedure to follow to request penalty abatement if and when a penalty is assessed.

    2. Edit CCC D if an internal use form or routing slip is attached and indicates DO NOT ASSESS FAILURE TO PAY PENALTY.

      Note:

      Do not enter CCC "D" if the return was prepared by IRS under IRC 6020(b) and the return due date (without regard to extensions) is after July 30, 1996.

    F Final Return
    • Edit CCC "F" when the taxpayer:

      1. Checks the FINAL box

      2. Gives a positive indication that they are not liable to file a return in the future with a notation such as, (but not limited to ):

        1. "Final"

        2. "Out of Business" ,

        3. "No Longer Have Employees" ,

        4. "Deceased" ,

        5. "Liquidation" , or

        6. "Dissolved" .

        Reminder:

        If editing CCC "F" always check the final box, if not already checked.

    • See IRM 3.11.13.11.3 Non-Taxable Returns with No Line Entries.

    • Do not edit CCC "F" when:

      1. The taxpayer elects to have a credit applied to the next return.

      2. The Date of Final Wages was not provided on a return showing tax data, See Note below.

      3. The Date of Final Wages is after the last day of the tax period.

      4. The taxpayer has indicated that he/she will not be liable to file the return in the future, AND that they are Seasonal. In this situation, edit CCC T unless the taxpayer has given the Date of Final Wages.

    • If the taxpayer has indicated that they will not be liable for filing the return in the future by checking the box or by a notation on the return (i.e. Final, Out of Business, etc.) and the Date of final wages is blank, then: Edit CCC F and process return.

      1. If the return shows tax data, correspond for the "Date of final wages" .

      2. If the return shows no tax data, DO NOT correspond for the "Date of final wages" unless corresponding for signature.

    • If the taxpayer files two or more quarters or years at the same time and the return indicates that they will not be liable to file the return in the future,

      1. edit CCC F on the last quarterly or annual return.

      2. Also, edit remarks on each of the earlier quarterly or annual returns to indicate that the latest tax period has been edited with a CCC F.

    G Amended Return

    Note:

    Edited to returns processed through ISRP only.

    1. An Amended return may be identified by such wording as

      • "Superseding" ,

      • "Additional" or any positive indication that the taxpayer has filed previously.

      • Filing a "Copy" or Duplicate of a return is not sufficient reason to label a return Amended unless accompanied by a positive statement from the taxpayer.

      • See IRM 3.11.13.24 for processing guidelines.

    2. The following procedures and conditions have been placed on the use of CCC G

      1. The return must be perfected for a Name Control (unless Check Digits are present), EIN, tax period, CCC G, Received Date, and Signature.

      2. If the return has a TC 59X or ICS which was entered by Collections or Exam and any indication of an amended return, process the return as an original return. Do not edit CCC G on these return.

    J Reasonable Cause for Failing To Make Timely Deposits
    1. Edit CCC J when the taxpayer notates at the top of the return :

      1. "3121 Agreement" (e.g., U.S., State, municipalities, or local, government agencies). These taxpayers are not required to make FTD payments. Also, edit a SIC 1 as applicable.

        Note:

        If the taxpayer only refers to IRC § 3121 by providing a particular paragraph as a reference (e.g., for example, IRC § 3121q) on the return or on an attachment, do not edit CCC J.

      2. "PL92-603" The taxpayer is a Religious Order reporting back taxes for retroactive quarters on Form 941 but the tax has not been paid.

    2. CCC J will no longer be edited, if the taxpayer requests abatement for Failing to Make Timely Deposits when the return is submitted.

      1. Send Letter 1382C, which will inform the taxpayer of the proper procedure to follow to request abatement, if, and when a penalty is assessed.

      2. In the cases of disaster, the examiners will be provided with coding procedures.

    M Misclassified Employees- Interest Free Adjustments
    1. Enter the code on the return indicating "Misclassified Employees" at the top of the return.

      • These taxpayers are allowed interest free adjustments if certain conditions are met.

      • Employers are instructed to write "Misclassified Employees" at the top of the return, and to indicate the date they ascertained (date the error was discovered) the error.

      • In order for the adjustment to be interest free, the return must be filed by the due date of the return for the tax period the error was ascertained.

      • If not, interest is computed from the original due date of the tax period for which the correction is being made.

      • If tax is not paid by the time the adjusted return is filed, interest is computed from the time the adjusted return is filed until payment is made.

      Note:

      Beginning January 1, 2009 adjustments reported on an adjusted return (e.g., Form 941-X) must be paid by the time the adjusted return is filed.

    2. 2008 and Prior Return Procedure: Upon identification of a "Misclassified Employees" return, do the following:

      1. Assure the information attached indicates the taxpayer ascertained the error (the date the error was discovered) before 1/1/2009.

      2. If the ascertain date is after 1/1/2009, place an asterisk to the left of the adjustment amount and edit an action trail "CP102/94X " .

      3. Continue to process the return.

    Note:

    If a taxpayer files a Return for "Misclassified Employees" and has tax data, route the return and attachments to Accounts Management.

    O Module Freeze Computer Condition Code is entered when a Pre-Settlement Manual Refund will be made and a Form 3753, Manual Refund Posting Voucher, Form 5792, Request for IDRS Generated Refund (IGR), or Form 12857, Refund Transfer Posting Voucher is attached.
    1. Verify that the Name Control, EIN, and tax period on the return is the same as the data on the form.

    2. Research to determine if TC 840 (Manual Refund Transaction) has posted.

      • If TC 840 has posted, enter CCC

      • O and continue processing.

      • If TC 840 has not posted, enter Action Code 344 in the left margin of the return to issue a manual refund.

    Q Form 8974 is attached Edit CCC Q to the bottom center margin of the F941, F941-SS, F941-PR, F943 , F943-PR or F944 to indicate that the F8974 is attached.  
    R Reasonable Cause for Failure to Timely File
    1. If the taxpayer requests abatement for Failing to Timely File when the return is submitted.

      • Send Letter 1382C, which will inform the taxpayer of the proper procedure to follow to request abatement, if, and when a penalty is assessed.

    2. Edit CCC R to the return when there is an indication such as

      • Do not assess failure to file penalty on a secured return noted with "599" .

    3. In the cases of disaster, the examiners will be provided with coding procedures.

    T Seasonal Filer
    1. Edit CCC T when:

      1. The Seasonal filer box is checked beneath the entity area

        • (Form 941, Revision 2004) or

        • on Line 17(Form 941, Revision 2005 thru 2008) or

        • on Line 19 (Form 941, Revision 2009-2011) or

        • on Line 16 (Form 941 Revision 2014- 2016) or

        • on Line 18 (Fom 941 Revision 2012, 2013, 2017 and 2018)

      2. If editing CCC T, check the Seasonal filer box if not already checked.

    Note:

    Do not enter CCC T when there is an indication this is the Final return.

    W " Cleared by Statute" or "Approved by Statute" Stamped on Return Refer to IRM 3.11.13.34, Statute Returns.
    X Refund/ Settlement Freeze
    • Edit CCC X when:

      1. The taxpayer requests that any excess remittance, after paying all the tax and penalties, be applied to another account. Follow the procedures in number 3 below.

      2. There is no reply to correspondence and a refund is due. Edit CCC "3" as well.

      3. Process as Follows:

        1. Prepare Form 3465 to request transfer of the excess remittance amount to an alternate account.

        2. Notate "Form 3465 Prepared" on the margin and edit CCC "X" on the return.

        3. Photocopy the return, and attach to Form 3465.

        4. Route the package to Accounts Management (AM).

    3 No Reply to Correspondence Edit CCC "3" when the return becomes unprocessable due to no reply from correspondence, for example, correspondence for the signature.
    4 6020(b) Return
    • Edit CCC "4" on all Compliance (Collection or Examination) issued IRC § 6020(b) returns.

    • Edit SIC 1 to Form 941, Form 943, Form 944 and Form 945.

    Note:

    CCC "R" cannot be used with CCC "4" .

    7 Reasonable Cause Denied
    1. CCC 7 will no longer be edited, if the taxpayer requests abatement for Failing to File or Pay Timely when the return is submitted.

      • Send Letter 1382C, which will inform the taxpayer of the proper procedure to follow to request abatement, if, and when a penalty is assessed.

    2. In the cases of disaster, the examiners will be provided with coding procedures.

    Note:

    All Receipt and Control functions were mandated to locally develop sort procedures for non-remittance Form 941 marked Amended, or Corrected. After sorting, these returns are forwarded to Accounts Management (AM) for their consideration. Therefore, if a non-remittance return marked Amended, or Corrected is received within Code and Edit, do not perfect the return, forward it to AM . This is a minimum standard requirement. Additionally, Code and Edit may receive returns with Amended, or Corrected circled. Do not forward these to AM. These returns are being re-input as original returns by AM. Therefore, continue to perfect these returns using Code and Edit procedures provided in IRM 3.11.13.

    Caution:

    ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

♦Error Resolution System (ERS) Coding♦

  1. The Error Resolution System (ERS) displays data on terminal display screens with corrections made and integrity verified in a real time environment.

  2. The Code and Edit tax examiner (TE) will have the first opportunity to identify a record having a problem which requires correspondence, research or other action in order to make the return processable. The tax examiner (TE) will determine the kind of action required and assign an Action Code to the return. The code will indicate whether correspondence, research or some other action is needed.

Delinquent Returns

  1. A return is normally delinquent if it is not received on or before the return due date. ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ A return is not delinquent if the return is timely postmarked and mailed before, or on the due date. If the due date falls on a weekend or legal holiday, the return is timely if postmarked by the first business day following the weekend or holiday. See IRM 3.11.13.12.5 for instruction on determining the Received Date of the return.

  2. If the return is delinquent, check the form and/or attachments for an explanation of late filing. If found, send the taxpayer Letter 1382C, letter to inform the taxpayer that we have received their request. Do not code the return with CCC R if a pre-computed delinquency penalty is shown.

    Exception:

    For secured or prepared returns, edit the applicable CCC as indicated on the return or attachment.

  3. See Exhibit 3.11.13-10, Employment Tax Return Due Date Table for the return due dates and the return delinquent dates for Employment Returns.

♦Received Dates♦

  1. The date a document is received in the Campus or IRS Office is the date stamped as the "IRS Received Date" .

  2. A valid IRS received date is required on the following returns:

    • Delinquent and any prior Quarters

    • Amended (e.g., CCC "G" coded)

    • Re-entry

    • 6020(b)

    • Substitute for Return (SFR)

    • Pre-computed penalty and interest is present

    Note:

    Re-entry Documents that do not have a received date, edit the due date for the tax period shown on the return as the received date.

  3. Use the following instructions to determine the Received Date:

    IF THEN
    ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡
    ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡
    The IRS received date stamp ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ of the legal or extended due date and the postmark or shipment date is on or before the legal or extended due date,
    • Edit the IRS Received Date to agree with the postmark or shipment date.

      Note:

      The postmark or shipment date includes returns delivered by:

      • U.S. Postal Service (USPS),

      • Designated Private Delivery Services listed in Notice 2016-30, e.g. DHL Express 9:00 , FedEX First Overnight or United Parcel Service (UPS) Next Day Air Early AM . See IRM 3.10.72, Receiving and Sorting, for a list of designated private delivery services, or

      • Returns with a Foreign Postmark.

      1. A private metered postmark is to be considered timely if the meter date is timely and if the document is received on or within the time ordinarily required for delivery ( 14 days).

      2. For certified mail only

        1. If a postmark is not present, look for an "USPS.com Track & Confirm" record that has been attached to the return (should be before the envelope).

        2. Use the "Acceptance" date on the record to determine timeliness and follow normal editing procedures.

        3. If the "USPS.com Track & Confirm" record is not attached, no action is required.

  4. When a 941 is delinquent and the taxpayer explains the return is late due to the rejection of a timely filed electronic return, check the return for a MeF rejection notification.

    Note:

    Taxpayers are instructed to notate in red in the top margin of the return REJECTED ELECTRONIC RETURN to indicate the timely filed return cannot be filed electronically. The notation could be anywhere on the return and is not required, but they should attach a copy of the MeF rejection notification.

  5. If a MeF rejection notification is not attached, perfection of the Received Date is not necessary. If a notification is attached, edit the IRS Received Date in MMDDYY format as follows:

    Note:

    The taxpayer has 10 days to resubmit an electronically filed return after being rejected and 10 days to submit a paper return after the last rejection.

    IF AND THEN
    The postmark date is within 10 days of the date of the rejection,   Edit the IRS Received Date to be the date of the rejection.
    For example, postmark date is 02-11-2017 and first rejection is 01-31-2017. Change Received Date to 01-31-2017.
    The postmark date is more than 10 days after the date of the rejection,   Leave the IRS Received Date as is.
    For example, postmark date is 02-15-2017 and first rejection is 01-31-2017. Leave the Received Date as is.

    Exception:

    Change the Received Date to the postmark date if the postmark date makes the return timely.

    There are two rejections, Within 10 days of one another and one is within 10 days of the postmark date, Edit the IRS Received Date to be the date of the first rejection.
    For example, postmark date is 02-26-2017, the second rejection is 02-16-2017. The first rejection is 02-13-2017 Change the Received Date to 02-13-17.
    There are two rejections with the time between the first rejection and the second rejection greater than 10 days, The second rejection is within 10 days of the postmark date, Edit the IRS Received Date to be the date of the second rejection.
    For example, postmark date is 02-22-2017, the second rejection is 02-12-2017. The first rejection is 02-01-2017 Change the Received Date to 02-12-17.
    There are two rejections, Not within 10 days of one another and not within 10 days of the postmark date, Leave the IRS Received Date as is.
    For example, postmark date is 02-23-2017, the second rejection is 02-12-2017. The first rejection is 02-01-2017. Leave the Received Date as is.

    Exception:

    Change the Received Date to the postmark date if the postmark date makes the return timely.

  6. The Received Date may or may not be stamped on the face of the return.

  7. A valid "Received Date" stamp may consists of the following:

    • The word "Received" ,

    • Month (alpha or numeric),

    • Day (for example, "1" or "01" ,

    • Year, i.e. four digits in "YYYY" format

    • Area office, Campus, field office, Taxpayer Assistance (TAC) plus the City (location or function area within one of these sites (CSO, Exam, ICT, CIS, AM, etc.)

      Exception:

      Not all IRS offices are designated places for filing, and not all IRS employees are authorized to accept a tax return for processing. If a return contains a received date stamp from other than a Taxpayer Assistance Center (TAC), Lockbox, or IRS campus (Compliance, Accounts Management (AM), or Submission Processing (SP)), circle out the invalid received date and edit the correct received date according to instructions below. For example, returns received by the Taxpayer Advocate Service (TAS) or the IRS Office of Chief Counsel are not properly filed and a received date by that office is not the "IRS Received Date" .

  8. If a Received Date is required but is not present or the date is illegible or invalid or has been erroneously circled, edit the Received Date in the MMDDYY format in the middle of page 1 to the return. Edit the Received Date according to the following priority:

    1. The earliest legible postmark date (U.S. Postal Service, foreign postmark or Private Delivery Service) on the envelope. Rules for using the U.S. Postal Service (USPS) postmark or Private Delivery Service (PDS) postmark are as follows:

      IF THEN
      An envelope is not attached, Use the postmark date stamped on the face of the return.
      A document was returned for insufficient postage, Use the postmark date that coincides with the correct delivery of the return.
      The postmark is missing and the envelope is certified,
      1. Look for the "USPS.com Track & Confirm" record that has been attached to the return (should be before the envelope).

        • Use the "Acceptance" date on the record to determine timeliness and follow normal editing procedures.

        • If the "USPS.com Track & Confirm" record is not attached, no action is required.

      An envelope has a USPS and a private metered postmark, Always use the USPS postmark.
      An envelope has a foreign and private metered postmark, Always use the foreign postmark.
      An envelope has two private metered postmarks, Always use the latest private metered postmark.
      An envelope has only one private metered postmark, Use the private metered postmark.
    2. Service Center Automated Processing System (SCAMPS) digital date

    3. The Revenue Officer's Signature date.

    4. The Signature date (Only if within the current year)

    5. The Julian Control date

    6. The current date minus 10 days.

  9. Edit the Received Date as follows:

    IF THEN
    A timely Received Date is the only received date stamped on the return, No editing is required.
    Two or more dates are stamped or handwritten on the return,
    1. Use the earliest stamped IRS Received Date.

    2. Circle out all other dates (handwritten or stamped) not needed for transcription.

      Note:

      Received dates that have been circled out by another function should be treated as if they are not present.

    A Federal return is addressed to the IRS but delivered to a State agency, Use the postmark date as the received date.
    A Federal return is addressed to the State agency, Use the IRS date stamp as the received date.
    The only Received Date on the return is a Taxpayer Advocate Service (TAS) or Chief Counsel received date, Circled out the TAS or Chief Counsel received date and Edit the IRS Received Date according to the instructions.

    Reminder:

    If an envelope is attached to the return, always check the envelope for remittance. If found, hand carry remittance to manager.

  10. If a return has been faxed to another area of the service and then sent to Submission Processing for processing, do not edit the Enterprise Electronic Fax (EEFax) Date as the IRS Received Date. Edit a Received Date according to normal procedures.

    Caution:

    The EEFax Date cannot legally be used as an IRS Received Date.

  11. Accept a received date entered by means other than a normal date stamp (for example, a handwritten date in brown, red, orange, or green), or a typed date by an IRS employee, cash register stamp date, etc.

  12. Circle and do not enter on the return a received date under the following circumstances:

    1. The first return in a block of RPS returns, if it is date stamped, provided the return is timely filed.

    2. Returns filed by the Department of Labor under the Fair Labor Standards Act, the General Accounting Office (GAO) and Housing and Urban Development under the Davis–Bacon Act, or the National Labor Relations Board under the Labor Management Relations Act.

    3. See 3.11.13.26 for early filed returns.

  13. See Figure 3.11.13-7 for an example of a correctly edited received date on a return.

    Figure 3.11.13-7

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-♦Third Party Designee♦

  1. The Third Party Designee election was created to allow a designated individual to inspect and/or receive information about the taxpayer regarding Form 941, Form 941-PR, Form 941-SS, Form 943, Form 943-PR, Form 944, Form 944-SP, Form 945 and Form CT-1 should questions arise during processing.

♦Third Party Designee Checkbox♦
  1. The Third Party Designee Checkbox is located above the taxpayer signature area. It indicates whether the taxpayer has elected to allow the Third Party Designee to inquire about the return as it is processed.

  2. No action is required.

♦Third Party Designee Personal Identification Number (PIN)♦
  1. Edit an asterisk (*) to the left of the entry, if illegible. This field can be up to 5 characters long. The entry may be any combination of Alpha (A-Z) and numeric (0-9). The PIN number is self-selected by the taxpayer or designee. It is not assigned by IRS.

♦Signature♦

  1. A signature and jurat is required on all returns except the following:

    1. Returns prepared under IRC § 6020(b). These returns must be signed by a Revenue Officer (RO) or Compliance Services representative (See IRM 3.11.13.33.1. If the Representative’s signature is missing, route to:
      Internal Revenue Service
      2970 Market St
      Mail Stop 5.E04.114
      Philadelphia, PA 19104

      Note:

      Starting July 1, 2013 we will accept the Revenue Officers (RO) electronic signature or typed signature as a valid signature on the return.

      Note:

      Accept a 6020(b) return, as signed when Form 5604, 6020(b) Action Sheet is attached and a signature is present in the "Signature of Initiating Collection Employee" box.

    2. Returns prepared by Examination, for example "SFR" or "Substitute for Return" (See IRM 3.11.13.33.3)

      Reminder:

      Returns secured by Examination do require a signature and jurat.

    3. Dummy returns prepared by IRS.

    4. Returns filed under IRC § 501(d) (Religious or Apostolic Organizations).

    5. A blank return with a CP 139 attached (e.g., notification that Form 941 or Form 940 may no longer be required because four consecutive 941 tax years were received with "NO LIABILITY" ).

    6. Correspondence containing a signature and jurat is attached showing that the taxpayer is responding to an IRS letter (See paragraphs (3) and (5) below).

    7. Some re-entry returns may have originally been filed electronically ("E-File" ). These returns may be identified by the presence of Mod E-File printouts in lieu of an actual return or "TRPRT PRINT DO NOT PROCESS" printed on the top margin. Do not correspond for missing signatures on these documents.

      Note:

      If the TRPRT print states "TRPRT Print Do Not Process" in the top margin, circle the words "Do Not Process" .

    Note:

    SCRIPS Form 941 (Revision 2005 and subsequent) - Edit an asterisk (*) in the left most position of the "Sign your name here" box when a signature is not required on the return.

  2. Do not correspond for a signature on CIS returns that have Form 13596 attached. See IRM 3.11.13.33, "Correspondence Imaging System (CIS) Returns" , for processing.

  3. If a signature is missing, correspond when:

    1. The return is not signed on the line designated for the taxpayers signature, or

    2. The jurat is not present on the line designated for the taxpayers signature (non-standard return).

    IF THEN
    • The return is not signed on the line designated for the signature, or

    • The jurat is not present on the line designated for the signature (non-standard return), or

    • Only the Entity information is present and there are no attachments containing tax data,

    1. Edit Action Code 225 (Correspondence for Signature Only) or 226 (International Correspondence) Corresponding for signature only.

    2. Leave in batch and continue editing.

      Note:

      Refer to Paperless Correspondence Procedures See Exhibit 3.11.13-17

    Note:

    Paper returns sent in by the filer that states their return was rejected through the E-file system require a signature. Form 8879-S is not an acceptable signature substitute for a paper return.

  4. If the jurat is altered or stricken (crossed out), See IRM 3.11.13.29, Potential Frivolous Returns.

  5. Accept a "signature declaration" (i.e. a signature with a jurat obtained through IRS correspondence) if it is attached to the return.

    1. If the "signature declaration" is altered or stricken, see Identification of Frivolous Returns in IRM 3.11.13.29.

    2. If the taxpayer responds with a self prepared "signature declaration" , it must contain the same language as the jurat on the return. i.e., "Under penalties of perjury, I declare that I have examined this return including accompanying schedules and statements, and to the best of my knowledge and belief, it is true, correct, and complete."

    Note:

    SCRIPS Form 941 (Revision 2005 and subsequent) - Edit an asterisk (*) in the left most position of the "Sign your name here" box to indicate the signature declaration is attached.

  6. Since tax examiners (TE) are not expected to be handwriting experts, regulations allow us to presume that the signature on a return, statement or other document is the true signature of the person who actually signed the document.

    Note:

    Very often, a preparer will mark a signature line with an "X" to indicate where a taxpayer should sign the return. When this happens:

    IF AND THEN
    An "X" is shown in the "Sign your name here" box, There is a name shown in the "Print your name here" box, Do Not Correspond.
    An "X" is shown in the "Sign your name here" box, The "Print your name here" box is blank, Correspond with the taxpayer to obtain a signature.
  7. Facsimile Signature - Rather than actually signing each return, Revenue Procedure 2005–39 allows a officer or duly authorized agent to use a "facsimile" (computer-generated or rubber stamp) signature when filing certain forms (such as Form 941, Form 943, Form 944, Form 945 or Form CT-1). If a facsimile signature is used, the person filing the form must retain a letter, signed by the officer or agent authorized to sign the return(s) declaring under penalties of perjury that the facsimile signature appearing on the form is the signature adopted by the officer or agent or at his or her direction, and that the facsimile signature was placed on the return by the officer or agent or at his or her direction.

    1. A signature of an officer or duly authorized agent, etc. can be printed, typed, rubber stamped, computer generated, or affixed by some other mechanical device, and is acceptable as a signed return on Form 941, Form 943, Form 944, Form 945, or Form CT-1. A signature refers to the name of the officer or agent who attests that the information on the return is true, correct and complete. See Figure 3.11.13-8for an example of a return that has been signed using a mechanical device

    2. The signature may appear on either "Sign your name here" or "Print your name and title" line.

    3. If no signature is found follow signature correspondence procedures in IRM 3.11.13.7

    Figure 3.11.13-8

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  8. Only one correspondence attempt is required for a signature.

♦Paid Preparer Section♦

  1. The paid Preparer Section is located below the signature area:

    • Form 941 - at the bottom of Page 2 of the return

    • Form 943 - at the bottom of the return

    • Form 944 - at the bottom of Page 2 of the return

    • Form 945 - at the bottom of the return

    • Form CT-1 - at the bottom of the return

  2. No action is required on amended returns.

♦Paid Preparer's Tax Identification Number (PTIN)♦
  1. The paid Preparer's SSN (2009 and prior revisions) or PTIN is located next to the Preparer's signature in the PTIN box (Preparer's SSN or PTIN box ) on all employment tax returns.

  2. No action is required on amended returns.

  3. The Preparer's SSN is a nine digit number. The SSN is not valid if it is all zeroes or all nines.

  4. A Preparer's PTIN is a valid entry in the Preparer's SSN area at the bottom of Form 941. The PTIN begins with an alpha "P" and followed by an eight-digit number (e.g., PXXXXXXXX).

  5. Edit an asterisk (*) to the left of the Preparer's SSN or PTIN if it is invalid.

♦Paid Preparer EIN♦
  1. The Preparer's Employee Identification Number (EIN) must be a nine digit number. The EIN cannot be all zeroes or all nines.

  2. Edit an asterisk (*) to the left of the Preparer's EIN if it is invalid.

♦Paid Preparer Phone Number♦
  1. If a complete Paid Preparer Phone Number is located on the Paid Preparer's Phone Number line, no editing of this line is necessary.

  2. If the Paid Preparer's Phone Number is incomplete, illegible, or less than 10-digits, review the return and all attachments. See Figure 3.11.13-9.

    Note:

    If more than 10 digits are present, continue processing the return. Only the first 10 digits will be transcribed (captured).

    IF THEN
    A complete Paid Preparer's Phone Number is located elsewhere on the return or attachments, Edit to the "Phone No." line.
    A complete Paid Preparer's Telephone Number is not located or the number is illegible, Asterisk to the left of the incomplete or illegible phone number.

    Figure 3.11.13-9

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♦Entity Perfection - General♦

  1. The entity area of a tax return identifies the taxpayer on the Business Master File (BMF). The entity area of the return contains the following:

    1. Employer Identification Number (EIN)

    2. Tax Period

    3. Name

    4. "In-care-of" name

    5. Address

    Note:

    When perfecting the entity always asterisk and line through the entry that is not to be transcribed. If the taxpayer has lined through a portion of the entity also place an asterisk to the left of the entry that is not to be transcribed. If another function, i.e. Accounts Management, Compliance, etc., has circled out a duplicate name control also place an asterisk to the left and line through the name control circled.

♦Entity Perfection - Name Control♦

  1. The Name Control consists of four characters or less:

    1. Valid characters are alpha, numeric, ampersand (&), hyphen (-), and blank. However, blanks are only valid in the last three positions.

    2. Disregard the word "The" in the Name Control only when more than one word follows.

    Note:

    If an individual and a trade name are present and it can be determined that the trade name is for a corporation or partnership, follow the Name Control procedures for corporations or partnerships. If other than a corporation or partnership, follow the Name Control procedures for Individuals, regardless of which line the individual name is listed.

  2. See Job Aid Document 7071A, Name Control Job Aid - For Use Outside the Entity Area, to properly determine the Name Control.

  3. It is no longer necessary to edit a name control on Form 941 returns that will be processed through SCRIPS. Do not take any action if the name control is already edited.

  4. Edit the Name Control on the following forms processed through ISRP; Form 941, Form 943, Form 944, Form 945 and Form CT-1 as follows:

    IF AND THEN
    Able to determine the Name Control,   Underline the Name Control.
    Unable to determine the Name Control, Numbered,
    1. Edit Action Code 352 (Name Research).

    2. Leave return in batch.

    Unable to determine the Name Control, Unnumbered,
    1. Research IDRS.

    2. If found, edit to the proper location.

    3. If not found, route to Entity Control.

    A return indicates the employer has filed bankruptcy (e.g., shows "RECEIVER" , "TRUSTEE" or "DEBTOR IN POSSESSION" ) in the entity area or on an attachment   Route to Entity Control following local procedures.

    Input TC 013 when there is a name change (primary and secondary) on Form CT-1 as these changes cannot be input through ISRP.

♦Entity Perfection -"In-Care-Of" Name♦

  1. An "in-care-of" name can be identified by the words "in care of" or the symbol "c/o" or "%" (percent sign).

  2. Ensure that the "in-care-of" name is located above the street address.

    IF THEN
    The in-care-of name is located on the street address preceding the street address, No editing is required,
    The in-care-of name is located above the first name line or below the street address,
    1. Step 1- Edit an asterisk (*) and line through the "in-care-of" name,

    2. Step 2- Edit the in-care-of name so it appears below the first name line and above the street address beginning with the % or c/o in the first position,

    3. Step 3- Continue processing the return.

    The "in-care-of" name is shown on an attachment, Edit the "in-care-of" name above the street address beginning with the "%" or "c/o" in the first position.
    The street address for the "in-care-of" name is different from the street address of the employer,
    1. As necessary, asterisk and line through the "in-care-of" street address and edit below the "in-care-of" name or edit the "in-care-of" street address below the "in-care-of" name if located on an attachment.

    2. Edit an asterisk (*) to the left and Line through the employer's street address and input "TC 014" .

    3. Continue editing the return.

    Note:

    Always Edit an asterisk (*) to the left and Line through the "in-care-of" symbol (% or c/o) if it is present with an address. Do not use the ampersand (&) or the percent sign (%) when editing the address information.

  3. A change in the "care-of name" can be determined by any of the following:

    • A check mark in the "Address change" box (Form 943 and Form 945), or

    • An indication that the "in-care-of" name is changed (i.e., the taxpayer crossed out the original "in-care-of" name and added the new name or has entered a new "in-care-of" name in brackets)

    IF THEN
    An "in-care-of" name is changed but there is no indication of an address change,
    1. Edit the "in-care-of" name as shown above in

    2. Continue editing the return.

    An "in-care-of" name is present and the "Address change" box is checked (or there is an indication of an address change),
    1. Edit the "in-care-of" name as shown above in

    2. Correct the address, See IRM 3.11.13.13.6.

    3. Continue to process the return.

♦Bankruptcy♦

  1. If the Form 941, 943, 944, 945 or CT-1 indicates bankruptcy (e.g. shows RECEIVER, TRUSTEE, or DEBTOR IN POSSESSION) in the entity area or on an attachment, route to Entity Control using local procedures.

♦Entity Perfection - Employer Identification Number (EIN)♦

  1. The EIN is a nine digit number (XX-XXXXXXX) assigned to identify the taxpayer.

  2. Determine the EIN as follows:

    IF AND THEN
    EIN is missing, You can determine the correct EIN from the return, attachments and/or schedules, Edit the EIN to the proper location on the return.
    The EIN is either a PTIN or ITIN, Unnumbered,
    1. Remove return from batch.

    2. Route to Entity Control following local procedures for EIN assignment.

    The EIN is either a PTIN or ITIN, Numbered,
    1. Edit Action Code 320.

    2. Leave return in batch.

    Multiple EINs are present, Unnumbered,
    1. Remove return from batch.

    2. Route to Entity Control following local procedures for EIN assignment.

    Multiple EINs are present, Numbered,
    1. Edit Action Code 320.

    2. Leave return in batch.

    The EIN contains any of the following conditions and cannot be determined from the return, attachments and/or schedules:
    • Illegible,

    • Missing,

    • Other than 9 digits

    • All zeroes, or

    • All nines,

    Unnumbered,
    1. Edit an asterisk (*) to the left and Line through the illegible EINs, all zeroes, or all nines,

    2. Research IDRS,

    3. If found, edit to the proper location,

    4. If not found, route to Entity Control following local procedures.

    The EIN contains any of the following conditions and cannot be determined from the return, attachments and/or schedules:
    • Illegible,

    • Missing,

    • Other than 9 digits

    • All zeroes, or

    • All nines,

    Numbered,
    1. Edit an asterisk (*) to the left and Line through the illegible EINs, all zeroes, or all nines,

    2. Edit Action Code 320.

    3. Leave return in batch.

    "Pending" , "applied for" , etc., is indicated in the EIN area, Unnumbered,
    1. Research IDRS,

    2. If found, edit to the proper location,

    3. If not found, route to Entity Control following local procedures.

    "Pending" "applied for" etc., is indicated in the EIN area, Numbered,
    1. Edit Action Code 320.

    2. Leave return in batch.

  3. If Page 1 and Page 2 of Form(s) 941, Form 941-PR, and Form 941-SS (Revision 2005 or subsequent) and Form 944, and Form 944-SP, are on a separate sheets make sure that the EIN is present on page 2 and matches the EIN in the entity of the first page. If the EIN is missing on Page 2 and the name on the second page matches the name of the first page, edit the last 4 digits of the EIN in the proper location. If the EIN on page 2 does not match the EIN in the entity of the first page, edit an asterisk to the left of the EIN on page 2 and edit the last four digits of the EIN to the left of the asterisk. Also ensure the EIN on Schedule B and Form 945-A, matches the EIN in the entity area of the first page of Form 941 or 944. If the EIN does not match, asterisk (*) to the left and line through the EIN and enter the last 4 digits of the correct EIN. Also, enter the last 4 digits, if there is no taxpayer entry.

  4. If a Form 941, Form 941-PR, Form 941-SS, Form 943, Form 943-PR, Form 944, Form 944-SP, Form 945 or Form CT-1 is received in C&E with a EIN beginning with "69" , forward the return to Entity control for a new EIN.

    IF THEN
    Unnumbered
    1. Attach Form 4227 with remarks "69 EIN - Issue new EIN."

    2. Complete all editing before routing to Entity.

    Numbered
    1. Edit Action Code 320.

    2. Attach Form 4227 with remark "69 EIN - Issue new EIN."

    3. Complete all editing before routing to Entity and leave in batch.

Entity Perfection - Tax Period - General

  1. All returns must have a tax period. If the return requires editing of the tax period it will be edited based on the form revision and the form type; quarterly or annual. Determine if the tax period must be edited using the rules for:

    1. Form 941, Form 941-PR and Form 941-SS (Revision 2005 and subsequent),

    2. Form 941, Form 941-PR, and Form 941-SS (Revision 2004),

    3. Form 944 and Form 944-SP,

    4. Form 943, Form 943-PR, Form 945 and Form CT-1.

    Note:

    If the taxpayer enters the due date of the return instead of the tax period ending (TPE) date, perfect the tax period to reflect the tax period ending (TPE) date.

    Note:

    Consider a "taxpayer indication" a notation on the return or an attachment to the return, placed by the taxpayer.

Entity Perfection - Tax Period - Form 941, Form 941-PR and Form 941-SS (Revision 2005- and subsequent)
  1. Process Current Year Revision Form 941, Form 941-PR and Form 941-SS (Revision 2018) as follows:

    IF AND THEN
    One tax period box is checked, There is no taxpayer indication on the return or attachments of another tax period, No editing is necessary.
    One tax period box is checked, A tax period that agrees with the checked box has been edited on the return, No editing is necessary.
    One tax period box is checked, There is an indication of a tax period elsewhere on the return or attachment that does not agree with the check box, Edit the correct tax period on top of the Report for this quarter... box in YYMM format.
    No tax period box is checked,  
    1. Review the return and the attachments for the correct tax period,

    2. If found "X" the box for the tax period indicated on the return or attachments,

      Note:

      If there is an indication the taxpayer is filing a current revision form for a tax period other than a current processing YEAR tax period, follow the instructions below.

    3. If the tax period cannot be determined, "X" the box indicating the current tax period being processed.

    There is an indication the taxpayer is filing a current revision form for a tax period other than a current processing YEAR tax period,   Edit the correct tax period on top of the "Report for this quarter..." box in YYMM format.
    The return would be considered an early filed return, All three are present on the return:
    1. Current Year Form revision,

    2. 3rd or 4th quarter tax period box checked,

    3. Tax Data appears on the return,

    Edit the year of the tax period to the Prior Year (PY) (i.e. If current Year Form Revision 2018, edit the year to "2017" ). Edit the tax period above the "Report for this Quarter" box in YYMM format. See Figure 3.11.13-10

    Caution:

    This type of return can be seen in the 4th, 1st or 2nd quarter return processing time frame, when the taxpayer has access to the latest revision of Form 941.

    More than one Tax Period box is checked,  
    1. Review the return and attachments for a taxpayer indication of the correct Tax Period,

    2. Edit the correct tax period on top of the "Report for this quarter..." box in YYMM format,

    3. If the tax period cannot be determine, edit and process the return for the earliest Tax Period shown by the taxpayer. See Figure 3.11.13-11.

    Figure 3.11.13-10

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    Figure 3.11.13-11

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  2. Process Prior Year (PY) Revision Form 941, Form 941-PR and Form 941-SS (Revision 2005 thru 2017) as follows:

    Note:

    If the tax period is 200412 or prior, the return cannot be processed through SCRIPS. Pull and rebatch to be processed through ISRP.

    IF AND THEN
    One tax period box checked, There is a taxpayer notation indicating a tax period in the current year,

    Note:

    Consider a Schedule B showing a current year as an indication a tax period in the current year,

    Edit the Form Title Year of the return to the current processing year (e.g., "2017" should be edited to "2018" ). Editing of the tax period above the "Report for this Quarter" box is not necessary. See Figure 3.11.13-12.

    Exception:

    Do NOT change the Form Title Year if doing so will make the return an early Filed Return.

    One tax period box checked,   Edit the tax period on top of the "Report for this quarter..." box in YYMM format, based on the Form Revision and the Tax Period check box.
    No boxes checked, The returns shows a Pre-printed label or there is a taxpayer indication on the return or attachments, Edit the correct tax period based on the information on the return or attachment on top of the "Report for this quarter..." box in YYMM format. See Figure 3.11.13-13.
    No boxes checked, There is NO indication of a Tax Period on the return or attachments, Process as a current quarter, current year return. Edit the Tax Period on top of the "Report for this quarter..." box in YYMM format.
    More than one Tax Period box is checked,  
    1. Review the return and attachments for the correct Tax Period,

    2. If the tax period cannot be determine, edit and process the return for the earliest Tax Period shown by the taxpayer,

    3. Edit the correct tax period on top of the "Report for this quarter..." box in YYMM format.

    Figure 3.11.13-12

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    Figure 3.11.13-13

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Entity Perfection - Tax Period - Form 941, Form 941-PR, and Form 941-SS (Revision 2004 and Prior) and Form 941CG
  1. Process Form 941, Form 941-PR and Form 941-SS Revision 2004 as follows:

    Note:

    All Tax Period references refer 2004 and prior period returns.

    IF THEN
    The tax period is shown on the return or attachment, Edit the tax period on top of the OMB box in YYMM format. See Figure 3.11.13-14.
    The tax period is missing, incomplete, or illegible,
    1. Review the return and attachments for the correct Tax Period,

    2. If found, edit the correct tax period on top of the OMB box in YYMM format,

    3. If the tax period cannot be determined, edit the tax period for the current quarter being processed on top of the OMB box in YYMM format.

    More than one tax period is shown on the return,
    1. Review the return and attachments for the correct tax period,

    2. If the tax period cannot be determined, edit and process the return for the earliest tax period shown by the taxpayer,

    3. Edit the correct tax period on top of the OMB box in YYMM format. See Figure 3.11.13-15.

    The taxpayer enters the due date of the return instead of the tax period ending date, Perfect the tax period to reflect the tax period ending date.
    Processing Form 941CG, Edit the tax period on top of the OMB box in YYMM format.

    Figure 3.11.13-14

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    Figure 3.11.13-15

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Entity Perfection - Tax Period - Form 944 and Form 944-SP,
  1. Process Form 944, and 944-SP as follows:

    IF THEN
    Return is for current processing year, No editing is necessary.
    Return is for prior processing year, Edit the tax period in "YY" format above the "Who Must File Form 944" . See Figure 3.11.13-16.

    Figure 3.11.13-16

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Entity Perfection - Tax Period - Form 943, Form 943-PR, Form 945 and Form CT-1
  1. Process Form 943, Form 943-PR, Form 945 and Form CT-1 as follows:

    IF AND THEN
    The return entity shows only the current tax period, There is no other indication of a tax period on the return or attachment, No editing is necessary.
    The (943, 943 PR and 945) return shows only a prior tax period, There is no other indication of a tax period on the return or attachment, Edit the correct tax period above the tax year revision in the "YY" format. See Figure 3.11.13-17.
    The CT-1 return shows only a prior tax period, There is no other indication of a tax period on the return or attachment, Edit the correct tax period in the upper right portion of the entity area in "YY" format. See Exhibit 3.11.13-8.
    The taxpayer has notated on the CT-1 return or attachment the correct tax period,   Edit the correct tax period in the upper right portion of the entity area in "YY" format. See Exhibit 3.11.13-8.
    The taxpayer has notated on the (943, 943-PR and 945) return or attachment the correct tax period,   Edit the correct tax period above the tax year revision in the "YY" format. See Figure 3.11.13-17.
    The tax period is missing, incomplete or illegible (Form 943, Form 943-PR and Form 945),  
    1. Review the return or attachments for the correct tax period,

    2. If found, edit the correct tax period above the tax year revision in the "YY" format.

    3. If the tax period cannot be determined, edit the tax period as the current processing year tax period above the tax year revision in the "YY" format.

    The tax period is missing, incomplete or illegible (Form CT-1)  
    1. Review the return or attachments for the correct tax period,

    2. If found, edit the correct tax period in the upper right portion of the entity area in “YY” format.

    3. If the tax period cannot be determined, edit the tax period as the current processing year tax period in the upper right portion of the entity area in "YY" format.

    More than one tax period is shown on the return,  
    1. Review the return or the attachments for the correct Tax Period,

    2. If the Tax Period cannot be determined, edit and process the return for the earliest Tax Period shown by the taxpayer,

    3. Edit the correct Tax Period above the tax year revision in "YY" format (Form 943, Form 943-PR and Form 945). If the return is a (CT-1) edit the correct Tax Period in the upper right portion of the entity area in "YY" format.

    The taxpayer enters the due date of the return instead of the tax period ending date( Form 943, Form 943-PR, Form 945 and Form CT-1),   Perfect the tax period to reflect the tax period ending date.

    Figure 3.11.13-17

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♦Entity Perfection - Domestic Addresses♦

  1. Perfection of the address is necessary when the mailing address (Street or P.O. Box) is not easily identified. For a list of correct street abbreviations, see Document 7475, State and Address, Abbreviations, Major City Code (MCCs), Zip Codes, and Countries.

    Exception:

    Do not perfect the address on amended returns (e.g., CCC "G" ).

  2. A business may have two addresses. One is the mailing address and the other is the location address or physical location of the business.

  3. If the return requires that the city, state, or ZIP Code be changed, edit an asterisk (*) to the left and line through the incorrect entry and enter the correction in the entity where space allows.

  4. The procedures for perfection of an address are as follows:

    IF AND THEN
    There is an indication on an attachment that the address has been changed,   Edit the new address in the Entity section of the return.
    Form 8822 Change of Address, or Form 8822-B, Change of Address - or Responsible Party Business, is attached, All of the following applies:
    • Mailing address information is the same,

    • No location address is listed on Form 8822/8822-B, Line 7,

    • No entry on Form 8822-B, Lines 8 or 9,

    Take no action.
    Form 8822 Change of Address, or Form 8822-B, Change of Address - or Responsible Party Business, is attached, Any of the following applies:
    • Mailing address information is different,

    • Location address is listed on Form 8822/8822-B, Line 7,

    • An entry is listed on Form 8822-B, Lines 8 or 9,

    1. Detach Form 8822/Form 8822-B and route to Entity Control following local procedures,

    Both a P.O. Box and a street address are shown,  
    1. Edit an asterisk (*) to the left and Line through the street address,

    2. Notate "TC 014" in the upper left margin,

    3. Input "TC 014" .

    See Figure 3.11.13-18 .
    The return does not have a pre-printed label and the address is a P.O. Box. The change of address box (Form 941 (Revision 2004), Form 943, Form 943-PR, and Form 945) is checked,
    1. Edit TC 014 in the upper left margin,

    2. Input "TC 014" .

     
    Two street addresses are shown,  
    1. Edit an asterisk (*) to the left and Line through the second street address,

    2. Notate "TC 014" in the upper left margin,

    3. Input "TC 014" .

    See Figure 3.11.13-19.

    Note:

    The asterisk and lined through address information will be input on IDRS before the return leaves C&E.

    One street address is shown, The taxpayer changes the address to a P.O. box,
    1. Edit an asterisk (*) to the left and Line through the street address, if the taxpayer has not already done so,

    2. Notate "TC 014" in the upper left margin,

    3. Input "TC 014" .

    The city and state are not shown on the return, but are shown on an attachment,   Edit the city and state in the Entity section of the return.
    The ZIP Code is missing or illegible, Is not available from the return or attachments, See Document 7475, State and Address Abbreviations, Major City Codes (MCC's), ZIP Codes and Countries, to determine the ZIP Code.

    Note:

    Edit the three digits followed by 01 of the first zip code listed for the applicable state (e.g., "99501" for Alaska).

    See Figure 3.11.13-20.
    Only the first three digits of the ZIP Code can be determined,   Edit "01" for the fourth and fifth digits.
    The address field is blank or incomplete, The address information is not available from the return or an attachment, Leave blank and allow to fallout to ERS.
    The address contains information other than a street address or P.O. box,   No perfection is necessary. ISRP and SCRIPS will enter the complete address.

    Note:

    Always edit an asterisk to the left and line through the "in care of" symbol ("c/o" or "%" ) if it is present with an address. Do not use the ampersand (&) and the percent symbol (%) when editing address information.

    Figure 3.11.13-18

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    Figure 3.11.13-19

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    Figure 3.11.13-20

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  5. An APO (Army Post Office), DPO (Diplomatic Post Office) and FPO (Fleet Post Office) addresses are considered domestic addresses. If an address appears as APO, DPO or FPO convert based on the ZIP Code (i.e. If the address appears as APO New York, NY 091XX; convert to APO AE 091XX). See Figure 3.11.13-21 for an example of an edited APO/FPO address. Refer to the APO/DPO/FPO Conversion Chart below:

    ZIP CODE Range Country Code
    340XX AA
    090XX - 098XX AE
    962XX - 966XX AP

    Figure 3.11.13-21

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♦Entity Perfection- Foreign Addresses (OSPC Only)♦

  1. A foreign (international) address is any address that is not in the 50 states or the District of Columbia.

  2. Returns with a APO or FPO address are considered domestic addresses. See IRM 3.11.13.13.6.

    Note:

    All returns with a Foreign Address will be processed through ISRP. If the return is batched for SCRIPS processing, after editing, pull the return from the batch and request the return be batched for ISRP processing. If numbered take the necessary steps to cancel the DLN.

  3. Route returns with a foreign address to Ogden Submission Processing Center (OSPC) for processing. Prepare 86C letter to inform the taxpayer that the return has been sent to OSPC.

    Note:

    Form 941-PR, Form 941-SS and Form 943-PR received with a domestic address (address in the 50 states or the District of Columbia) should be processed as a Foreign Return. Do Not convert to a Domestic Return, unless directed by an attachment to the return.

  4. Returns with addresses in the following U.S. Possessions are considered to have a foreign address for processing purposes but are edited in the same way as a domestic address.

    1. A two-character alpha code must be edited for the country/possession/territory name:

      U.S. Possession Abbreviation
      American Samoa AS
      Federated States of Micronesia FM
      Guam GU
      Marshall Islands MH
      Northern Mariana Islands MP
      Palau PW
      Puerto Rico PR
      Virgin Islands (U.S.) VI
    2. A ZIP code must be present for U.S. Possessions/Territories. Edit the appropriate ZIP code if not provided. See Exhibit 3.11.13-18.

  5. All other foreign addresses are edited the same as a domestic address with the following exceptions:

    1. The foreign country must be the last entry in the address.

    2. Edit an asterisk and line through the foreign country and edit the foreign country code preceded by a "/" and followed by "/$" as the last entry in the address. See Document 7475 for official foreign country codes. See Figure 3.11.13-22 for an example of an edited return with a Foreign Address.

      Note:

      International (OSPC ONLY) Arrow country or country codes, province code and postal codes to the proper address location in the correct Foreign address format.

    3. A unique country code will be edited for returns filed with an address in Canada. See IRM 3.11.13.13.7.1

      Note:

      Submission Processing BMF Foreign Address Job Aid (Number 2324–002) provides examples for editing foreign addresses.

    4. If the foreign address is from Australia, Brazil, Canada, Cuba, Italy, Mexico, or the Netherlands, check if the address contains a province, state or territory name.

      IF THEN
      A province, state or territory is present,
      1. Edit an asterisk and line through the province, state or territory,

      2. Edit the appropriate abbreviation. See Exhibit 3.11.13-19.

      A province, State or territory name is not present, Continue editing the return.
      Province, state or territory is shown in abbreviated format, Continue editing the return.
    5. A ZIP code is not required on a foreign address. Foreign addresses use a postal code that is entered before the city or foreign country and is part of the address.

    Figure 3.11.13-22

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♦ Country Code – Canada ♦
  1. In an effort to assist Compliance with workload assignment, returns filed with an address in Canada will be edited using a unique country code based on the province/territory.

    IF THEN
    The foreign address contains a Canadian Province/Territory name, or abbreviation shown in the table below,
    1. See table below to ensure the correct Canadian Province/Territory is present or edited to the return.

    2. Edit an asterisk and line through the country name.

    3. Edit the appropriate country code based on the province/territory preceded by a "/" and followed by a "/$" as the last entry in the address.

    The foreign address does not contain a Canadian Province/Territory or name or abbreviation shown in the table below,
    1. Edit an asterisk and line through the country name.

    2. Edit the country code "/CA/$" as the last entry in the address .

    Canadian Province/Territory Province Abbreviation Postal Code Beginning Country Code
    Alberta AB T XA
    British Columbia BC V XB
    Manitoba MB R XM
    New Brunswick NB E XN
    Newfoundland and Labrador NL A XL
    Northwest Territories NT X XT
    Nova Scotia NS B XS
    Nunavut NU X XV
    Ontario ON K, L, M, N, or P XO
    Prince Edward Island PE C XP
    Quebec QC G, H, or I XQ
    Saskatchewan SK S XW
    Yukon YT Y XY

Employment Codes

  1. Form 941 and Form 944 entities on the BMF contain an employment code. Employment Codes identify businesses which are other than normal business entities. Employment Codes may be displayed by some IDRS Command Code (CC) (e.g., INOLE, BMFOL).

    Note:

    In 2011, HQ Publishing Services ceased the mailing of pre-printed tax forms based on the taxpayer's filing requirements. Therefore, Employment Codes will only appear on forms with Revision Years prior to January 1, 2011.

    Employment Code Employer's Status Employment Code Numerical Equivalent Displayed By Some Command Code (CC) Liable for Social Security or Medicare?
    A A state or local government health and welfare agency acting as an agent under IRC § 3504 on behalf of home care service recipients. blank Subject to withholding for Social Security and Medicare taxes.
    C Church or church-controlled organization opposed for religious reasons to the payment of social security and Medicare taxes. 8 Exempt from both Social Security and Medicare taxes.
    F Federal Employer. 6 May be exempt from Social Security taxes Medicare is taxable.
    G State/Local Government Agency- Employer not under Section 218 agreement and files Form 941. blank May be exempt from both Social Security and Medicare taxes.
    I Indian Tribal Government. blank Subject to withholding for Social Security and Medicare taxes.
    M Maritime Industry. 4
    • Subject to withholding for Social Security and Medicare taxes if working inside United States.

    • May be exempt if working outside the United States.

    N Non-Profit Organization blank Subject to withholding for Social Security and Medicare taxes
    S Foreign Subsidiary (OSPC only)- Form 2032 filed. 2 Subject to withholding for Social Security and Medicare taxes.
    T State/Local Government Agency- Employer under Section 218 Agreement. 1 Subject to withholding for Social Security and Medicare taxes.
    W Non-profit Organization- IRC § 501(c)(3) filer. 3 Subject to withholding for Social Security and Medicare taxes.

Form 941, Employer's QUARTERLY Federal Tax Return, Form 941-PR, Planilla para la Declaración Federal TRIMESTRAL del Patrono and Form 941-SS, Employer's QUARTERLY Federal Tax Return - American Samoa, Guam, the Commonwealth of the Northern Mariana Islands, and the U.S. Virgin Islands - General

  1. There are three types of tax reported on Form 941:

    • Income Tax Withholding tax will be reported on Form 941;

    • Medicare tax will be reported on Form 941, Form 941-PR and Form 941-SS; and

    • Social Security tax will be reported on Form 941, Form 941-PR and Form 941-SS.

  2. Domestic and Foreign consideration of Form 941:

    1. Domestic -
      • Form 941: Employers whose principal place of business is in the U.S.
      • Form 941: with a foreign (international) address that is not in the 50 states or the District of Columbia (OSPC ONLY - WITH FOREIGN ADDRESS ONLY).

    2. Foreign (OSPC Only) -
      • Form 941-PR : Employers whose principal place of business is in Puerto Rico.
      • Form 941-SS: Employers whose principal place of business is in American Samoa, Guam, the Commonwealth of the Northern Mariana Islands, and the U.S. Virgin Islands.

  3. Foreign Return Processing:

    1. All Forms 941 with a foreign address or an address of an U.S. possession, Form 941-PR, and Form 941-SS, should be processed at the Ogden Submission Processing Campus (OSPC). If these returns are received in any other Submission Processing Campus, they must be transshipped to OSPC. APO, DPO and FPO are not considered foreign addresses.
      • If the return is unnumbered, withdraw it from the batch and prepare Form 13195 requesting the Letter 86C be sent to the taxpayer. Attach a Form 4227 for routing to OSPC.
      • If the return is numbered, use AC 650.

    2. Form 941-PR, and Form 941-SS, are similar to Form 941. However, they only contain Social Security and Medicare tax. The line numbers must be the same as the domestic returns. If they are not, alter the numbers to make them compatible with the transcription lines for the current revision of Form 941.

    3. Withheld Income Tax should not be reported on Form 941-PR and Form 941-SS. However, certain filers may have employees who are subject to the income tax withholding. If such filers include the income tax withholding and/or income tax withholding adjustments on the returns (such as showing the amounts in the shaded areas):

      Note:

      The following procedures will change the Filing Requirement from a Form 941-PR, or Form 941-SS, to a Form 941 filer. Care should be taken before entering this change:


      • Code a numbered return with AC 620 for Reject processing.
      • Prepare a substitute return for the erroneous U.S. possession return if the return is unnumbered.
      • Prepare and release promptly a Form 2363, Master File Entity Change, to change the BMF filing requirement code from "6" or "7" to "1" .

    4. Otherwise, the instructions provided for Form 941, Form 943, Form 944 or Form 945 returns filed with foreign or U.S. possession addresses) should be followed to the extent possible to process these returns. Specific procedures for these returns are:
      • An address change may be made on the returns if it will not change the Filing Requirement Code from "6" to "7" or "1" , or from "7" to "1" or "6" . Otherwise, a Form 2363 must be prepared showing TC 013.
      •See IRM 3.11.13.13.1 for instructions to follow regarding the Name Control and see Document 7071A, Name Control Job Aid - For Use Outside of the Entry Area, or determining a Name Control .

    5. Tax Periods 200812 and prior- A Social Security/Medicare Tax adjustment ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ must be substantiated by an attachment in English. A foreign language attachment is acceptable if the adjustment has been previously approved by an interpreter or the attachment contains an English translation. Code the return with AC 360 for routing to the interpreter, if necessary.

    6. Do not send these returns back for missing signature, initiate letter 21C.

  4. Non-payroll items including backup withholding and withholding for pensions, annuities, gambling winnings, Individual Retirement Account (IRA), 401K, military pensions, etc. should be reported on Form 945, Annual Return of Withheld Federal Income Tax. See IRM 3.11.13.22, for more information on Form 945.

    IF AND THEN
    There are entries only on Lines 3,12,13 and 14 (Revision 2017-2018) or Lines 3, 10 11 and 12 (Revision 2016-2014), or Lines 3, 10, 11, 14, (Revision 2013-2011), or lines 3, 8, 10, 11 and 12 Revision 2008 and Prior, or lines 3, 8, 10, 11, and 14, for Revision 2009 or 2010) There is an indication the taxpayer is filing for Non-Payroll items. (e.g., the entity name contains such references as Employee Pension Plan, Pension, 401K Plan, Profit Sharing Plan, Retirement Fund, Lottery, IRAs, Annuity, etc.)
    1. Correspond to determine the taxpayer's intent,

    2. If their reply indicates that they should have filed and reported the entries on a Form 945, route the Form 941 to Accounts Management (AM) on Form 3465 with notation "NON-PAYROLL ON FORM 941" ,

    Note:

    This procedure will advise Accounts Management (AM) to delete the filing requirements for the Form 941 and establish new filing requirements for Form 945;
    to post any payment(s) to the correct module (e.g., Form 945 tax period) and to return the Form 941 to the taxpayer, with a letter to explain how they must now report their tax.

    Caution:

    If it can be determined the taxpayer has a "non-qualified plan" , correspond with the taxpayer explaining that it was a wage deferred plan subject to wage withholding and must be reported on Form 941.
    For an explanation of non-qualified plan, see number 5 below.

  5. "Non-qualified" Plans - Certain companies (for example, Life Insurance Companies) sell annuity contracts to participants in "non-qualified" plans or deferred compensation plans. Distribution of these contracts are payments of deferred wages subject to withholding and reportable on Form W-2 and Form 941.

    1. If the taxpayer notates on a Form 941 in the left margin, or you are able to determine that it is a "non-qualified plan" , edit CCC "B" on the return and continue to process.

Form 941, Form 941-PR and Form 941-SS (Revision 2005 and subsequent) Return Perfection and Line Editing

  1. All Forms 941 with a Foreign Address, Form 941-PR and Form 941-SS will be processed through ISRP. If the return is batched to be processed through SCRIPS, take the following action:

    IF THEN
    Numbered Batch, Edit Action Code 460.
    Unnumbered Batch, Pull from batch, and request the return be merged into a batch that will be processed through ISRP.
  2. Perfection procedures for each field of the entity on Form(s) 941, Form 941-PR and Form 941-SS may be found in IRM 3.11.13.13.

  3. Most Forms 941 (Revision 2005 and subsequent) returns with a domestic address must be edited and processed through SCRIPS. These returns are batched and prepared separately as either "Perfect" or "Imperfect " .

    1. "Perfect" - are returns with no attachments, such as envelopes, letters, copies of notices, internal forms for processing or routing, etc. "Perfect" returns cannot have extraneous writing on the face of the return.

    2. "Imperfect" - are returns not covered in a) above.

  4. SCRIPS Form 941 returns (Revision 2005 and subsequent), must be prepared as follows:

    1. Perfect Only Carefully remove all staples. It is permissible to cut off the left corner of the return provided no identifying information is damaged or lost (e.g., the return year, entity information, etc.).

    2. Perfect Only - Repair any large staple holes, rips and tears on the top and right hand side of the return.

    3. "Perfect" and "Imperfect " :

      IF THEN
      The name and EIN are both missing on Page 2 (i.e. one sided documents) and/or Schedule B, Edit the full EIN in the EIN field.
      The name is present on page 2 only (i.e. one sided documents) and/or Schedule B, Edit the last four digits of the EIN in the EIN Field.
      The taxpayer completes the Form 941 (Revision 2005 and subsequent) information using orange, or pink ink, Photocopy the return to allow for processing through SCRIPS. Consider the original Form 941 as an attachment and request the document be merged into an "Imperfect" batch.
      The signature ONLY is in orange or pink ink, Edit an asterisk (*) in the left most position of the "Sign your name here" box.
      A page 1 (one sided) Form 941 (Revision 2005 and subsequent) is missing
      • Follow local procedures to reduce the chance of duplicating letters being sent to the taxpayer. Use tools such as IDAP and IDRS (Command Code (CC) BMFOL and ERVIN) and request page 2 be associated with page 1 when possible.

      • If it is not possible to associate:

        1. Insert a blank copy of page 1,

        2. Edit from page 2:

          1. Taxpayer's Name (If Name only research for EIN).

          2. EIN (If EIN only research for Name).

            Note:

            If Name and EIN field are blank on page 2; use the information from the envelope (if available) to research. If research cannot be performed to obtain entity information give to lead for disposition (If there is a legible signature, route to Entity for research).

          3. Tax Period (Edit the tax period in the following priority):
            • Schedule B, if applicable,
            • Current Tax Period.

          4. Address (Edit in the following priority):
            • From the envelope if name match.
            • Leave blank and allow to fall out to ERS.

            Note:

            If research is being performed in b) above obtain address information also.

        3. Edit a Received Date as necessary,

        4. Edit AC 211 and Correspond using Letter 21C for a missing page (Refer to Form 13195).

      A page 2 (on one sided) Form 941 (Revision 2005 and subsequent) is missing, or page 2 is from Form 940 or 944
      • Follow local procedures to reduce the chance of duplicating letters being sent to the taxpayer. Use tools such as IDAP and IDRS (Command Code (CC) BMFOL and ERVIN) and request page 1 be associated with page 2 when possible.

      • If it is not possible to associate:

        1. Insert a blank copy of page 2 behind the taxpayer's page 1,

        2. Edit last 4 digits of EIN to page 2,

        3. Line through page 2 (Form 940, Form 944) and attach the page to the back of the Form 941 return.

        4. Use AC 211 to correspond using Letter 21C for a missing page.

      The taxpayer encloses a duplicate page 2 (on a one sided or duplex return),
      • Consider the extra page as an attachment and request the document be merged into an "Imperfect" batch.

      • Line through (/) the duplex page 2.

      The taxpayer used only page 1 of a duplex (two sided) return and a separate page 2,
      1. Photocopy the original page 1,

      2. Line through (/) the original duplex page 1 and duplex page 2, this now becomes an attachment,

      3. Request the document be merged into a SCRIPS Imperfect batch.

      Taxpayer used only page 2 of a duplex (two sided) return and a separate page 1,
      1. Photocopy the original page 2,

      2. Line through (/) the original duplex page 1 and duplex page 2, this now becomes an attachment,

      3. Request the document be merged into a SCRIPS Imperfect batch.

      Note:

      If the return is damaged or print is too light (hard to read); pull the return from batch and request the return be re-batched as "OE PAPER" . Renumber the lines if necessary.

  5. Code and Edit examiners should ensure the jurat and authorized signature are shown and are in the proper location on the return. See IRM 3.11.13.12.7Signature, for signature editing procedures.

  6. Code and Edit should edit on the return the required information in the designated location on the foreign Form 941, Form 941-PR and Form 941-SS. See Exhibit 3.11.13-1 for the transcription lines of Form 941, (Revision 2017-2018). See Exhibit 3.11.13-2 for Form 941-PR. See Exhibit 3.11.13-3 for Form 941-SS.

  7. Code and Edit should edit the required information in the designated location on SCRIPS Form 941, (Revision 2005 and subsequent).

  8. After editing, Form 941, Form 941-PR and Form 941-SS, schedules and attachments should be in the following sequential order when placed back in the batch:

    1. Form 941, Form 941-PR and Form 941-SS, Page 1,

    2. Form 941, Form 941-PR and Form 941-SS, Page 2,

    3. Schedule B, Report of Tax Liability for Semi-weekly Schedule Depositors, if applicable,

    4. Schedule R/Schedule R continuation sheet

    5. Attachments, if applicable.


    This will assist SCRIPS and ISRP during data transcription.

  9. Always edit money amounts in DOLLARS and CENTS.

  10. Editing is not required for any amount less than $1.00.

  11. Any line with an incorrect entry should be edited with an asterisk (*) and moved to the correct line.

    Note:

    If Line 10 (Revision 2005-2010) shows a negative or minus entry on a large dollar ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ return, check the Schedule B to determine if it is the same amount. If so, treat the entry on Line 10 (Revision 2005-2010) as a misplaced entry and enter the amount on Line 11 (Revision 2005-2010). If not, consider the entry as an excess of Advance Earned Income credit (for Revision 2005 through 2010). Asterisk (*) the entry on Line 10 (Revision 2005-2010), and enter the total tax amount from Line 8 (Revision 2005-2010). Calculate the difference between the amounts of Lines 8 and 10 (Revision 2005-2010), and enter the result to Line 11 (Revision 2005-2010).

  12. Verify all negative, minus, or subtracted amounts ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

  13. If any transcription Line entries are illegible, place an asterisk (*) to the left of the taxpayer's entry and enter the correct amount to the left of the asterisk.

  14. Code and Edit Tax Examiners (TE) should edit the correct Line number for any return Line which is unnumbered. Edit the line number to the left of the taxpayer or edited entry. Also, on Schedule B, if any daily box with an entry is unnumbered, Code and Edit should edit the applicable number for that box.

  15. Form 941 has been changed to Form 944, by crossing out 941 and writing 944 on the return. Research (INOLE) to determine the correct filing requirement for the taxpayer.

    Note:

    Follow these procedures when a Form 941 is received in Document Perfection with instructions to process as Form 944.

    IF AND THEN
    Research provides filing requirement, Filing requirement is for Form 941, Process return as a Form 941.
    Research provides filing requirement, Filing requirement is for Form 944, Process return as a Form 944. Asterisk (*) Line 1 and renumber the remaining - T-lines.

    Note:

    Lines 7a, 7b and 7c for Form 941 correlate with Line 6 (Line 6a Revision 2008 and Prior) of Form 944. Compute and enter on renumbered "6" ("6a" Revision 2008 and Prior).

    Research does not provide filing requirement,   Process return as a Form 941.
  16. Form 941 Schedule R/Schedule R Continuation Sheet:

    1. A Schedule R Indicator (SRI) "R" will generate when Schedule R (Form 941), Allocation Schedule for Aggregate Form 941 Filers or Schedule R Continuation Sheet is attached to Form 941.

    2. Write the last four digits of the EIN, if the EIN is not present on the Schedule R.

    3. All 941 returns with Schedule R attached MUST be processed through SCRIPS.

      Exception:

      A Schedule R attached to a Form 941 with a foreign address, Form 941-PR or Form 941-SS will be processed through ISRP. A Form 941 with a foreign address, Form 941-SS and Form 941-PR with a Schedule R attached must have the Schedule R Indicator code edited in the right margin of the return next to Line 7. See Figure 3.11.13-23

      Note:

      If a loose (not attached) Schedule R Form 941 is received - Route to Account Management.

    .

    Figure 3.11.13-23

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Line 1, Number of Employees Who Received Wages, Tips, or Other Compensation (Revision 2005 and subsequent) -

  1. Perfect line for validity only. All alpha words must be written in numeric form. Edit an asterisk (*) to the left of the entry and edit the correct number to the left of the asterisk (*).

    Note:

    If illegible, edit to be non-transcribable by placing an asterisk (*) to the left of the entry.

    Exception:

    Notations of "zero" , "none" and "blank" do not need to be converted to a numeric equivalent.

  2. If the amount shown on Line 1 is a misplaced entry (the entry is in dollars and cents) and that amount should be on Line 2 (i.e. Line 1 is the same amount shown on Line 5a and/or 5c ) edit as follows:

    • If Line 2 is blank, then place an asterisk to the left of the entry on Line 1 and edit the amount to Line 2.

    • If Line 2 is the same amount as Line 3, then place an asterisk to the left of the entry on Line 1 and then to the left of the entry on line 2 and edit the amount on Line 1 to the left of the asterisk on Line 2.

  3. If the entry on Line 1 appears to be a number of employees for all four quarters, a number followed by a comma, space or dash and followed by another number (i.e. 24, 24, 22, 23), place an asterisk next to the entry.

Line 2, Wages, Tips, and Other Compensation (Revision 2005 and subsequent)

  1. There must be an entry on Line 2. Edit an entry to Line 2 as required based on the available information on the return or on any attachment(s). Process Line 2 as follows:

    Note:

    All line references refer to Form 941, Revision 2005 and subsequent.

    IF AND THEN
    Line 2 is zero, dash "none" , or blank, Line 5c, Column 1 has an entry (greater than zero or "none" ), Edit Line 5c, Column 1 amount to Line 2. See Figure 3.11.13-24.
    Lines 2, and 5a (Column 1 or 2), 5b (Column 1 or 2), and 5c (Column 1 or 2) are blank, Only Line 3 is completed,
    1. Review the return and attachments for an indication why the lines are blank,

    2. If none, correspond with the taxpayer for Lines 2 and 5a, 5b, 5c and 5d. See Figure 3.11.13-2. See also IRM 3.11.13.7, before corresponding,

    Caution:

    DO NOT correspond for Line(s) 2, 5a, 5b, 5c, or 5d if there is a definite indication tax was withheld:
    • From only third party sick pay,
    • From supplemental unemployment,
    • When there is an indication that the wages are exempt from Social Security and/ or Medicare by an entry in the check box on Line 4. If so, edit CCC B.

    Line 2 has an entry of $99.99 or less, There is no significant entry on Lines 5a, 5b, 5c or 5d (Column 1 or 2) Do not correspond for Social Security/Medicare wages.

    Figure 3.11.13-24

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Line 3, Income Tax Withheld from Wages, Tips, and Other Compensation (Revision 2005 and subsequent)

  1. Perfect this line for validity. Ensure all entries are numeric in dollars and cents. If the taxpayer has entered dollars only, examiners do not have to correct the entry to dollars and cents.

  2. Do not change the entry on this line unless you are able to identify from the return or an attachment that the amount shown on the line is the difference between the correct income tax withheld for the quarter and an adjustment.

    1. If an adjustment is included with the entry on Line 3, edit an asterisk (*) to the left of the amount.

    2. Edit the correct amount of income tax withheld to Line 3, left of the asterisk.

Form 8274, Church Exempt from Social Security and Medicare Taxes -

  1. Churches and qualified church-controlled organizations opposed to the payment of Social Security and Medicare taxes for religious reasons may elect exemption from the payment of the employer's share of these taxes. However, Form 8274, Certification by Churches and Qualified Church Controlled Organizations Electing Exemption from Employer Social Security and Medicare Taxes, must be filed with the Entity function at the Ogden Submission Processing Campus.

  2. The electing organization must continue to withhold Federal income tax on wages, tips, and other compensation, and to report this income and the tax withheld on Form W-2, Wage and Tax Statement. The organization must also file Form 941 to report both the wages covered by the election and the wages of any employees engaged in unrelated business activities whose wages are not covered by this election and are subject to both the employee and employer's share of Social Security and Medicare taxes.

    1. The electing church or organization can permanently revoke the election by paying Social Security and Medicare taxes for wages covered under the election. If the taxpayer files a Form 941 indicating that the election is being revoked, send to Entity Control for filing requirement change.

    2. The IRS will permanently revoke the election if the organization does not file Form W-2 for two or more years and does not provide the information within 60 days after a written request by the IRS.

  3. If a Form 941 is received with no entries on Lines 3 through 7 and the taxpayer either has attached a letter to the return protesting the tax on religious grounds or has written his protest on the return, then send the return to the Entity Control function with a request to research for a Form 8274.

  4. If a Form 8274 is attached to a timely filed Form 941 (with or without entries in Lines 3 through 7:

    1. Detach Form 8274 and notate on the form, "Detached from return with Church FICA issue." Forward the Form 8274 to:
      Ogden Submission Processing Campus
      Entity Control
      Ogden, UT 84201-0027

    2. Notate on the return's left margin, "F8274 to ECU" and process the return without any Social Security or Medicare wages being shown on the applicable lines.

Form 941 with Notation, "Church FICA Issue" -

  1. The churches with the notation, "CHURCH FICA ISSUE" did not elect the exemption from Social Security and Medicare taxes permitted by IRC § 3121(w).

  2. These taxpayers are forever barred from filing Form 8274. The wages must be reported on Form 941.

  3. Process a Form 941 with the notation "Church FICA Issue" as follows:

    Note:

    All line references refer to Form 941, Revision 2005 and subsequent.

    IF THEN
    There are no entries on Form 941, Lines 3 through 5c (Revision 2012 and prior) or Lines 3 through 5d (Revision 2013 and subsequent), column 1 and 2,
    1. Review the return to determine if there is an entry in the Line 4 check box,

    2. If so, edit CCC "B" .

      • If there is no entry in the Line 4 check box, correspond with the taxpayer for the amount of Social Security and Medicare wages since they are fully taxable,

    3. If there is no dollar entry only on column 1 and 2 Line 5c (Revision 2012 or prior) or 5d (Revision 2013 and subsequent), enter CCC "B" ,

    4. Edit SIC 3 on the return,

    5. If Form 8274 is attached to the return, see IRM 3.11.13.15.4, for procedures and continue to process the return.

Line 4, Total Social Security and Medicare Wages Exempt

  1. Follow the procedures below for the box on Line 4:

    Note:

    All line references refer to Form 941, Form 941-PR and Form 941-SS (Revision 2005 and subsequent).

    IF AND THEN
    The box on Line 4 is checked,   Edit CCC "B" Continue to process. See Figure 3.11.13-25.
    The box on Line 4 is not checked, Column 1, Lines 5a, 5b, 5c and 5d are blank, dash or "None" , but Column 2, Lines 5a, 5b, 5c and 5d show entries See IRM 3.11.13.15.7 for Instructions for computing 5a, 5b, 5c and 5d Column 1 lines

    Figure 3.11.13-25

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Line 5a, (Column 1), 5b, (Column 1), 5c (Column 1 ), and 5d (Column 1) Taxable Wages and Tips subject to Additional Medicare tax withholding (Revision 2013 and subsequent) or Line 5d, Total Social Security Wages and Tips, Total Medicare Taxes (Revision 2012 and prior ) or Line 5e, Total Social Security Wages and Tips, Medicare and Additional Medicare Taxes (Revision 2013 and subsequent)

  1. Process Lines 5a (Column 1), 5b (Column 1), 5c (Column 1), Line 5d (Revision 2013 and subsequent)(Column 1)) and Line 5e as follows:

    IF AND THEN
    An entry appears on Line(s) 5a (Column 2), or 5b (Column 2), or 5c (Column 2) and/or 5d (Column 2 (Revision 2013 and subsequent), but no entry appears on Line(s) 5a (Column 1), 5b, (Column 1) 5c or 5d (Column 1) (Revision 2013 and subsequent), or (Revision 2012 and prior)  
    1. Take the tax amount reported in column 2, Lines 5a, 5b, 5c and/or 5d (Revision 2013 and subsequent) and:

      • Multiply it by the appropriate factor in the table in Exhibit 3.11.13-12, or

      • Divide the tax amount by the sum of the Social Security tax rate (.124 (Revision 2018, 2017, 2016, 2015, 2014, 2013, 2010 and prior), or by .104 for (Revision 2012 and 2011), for the Medicare rate divide by (.029) and for the Additional Medicare tax withholding by .009

      • Enter the result on the appropriate wage or tip Line(s). See Figure 3.11.13-26.

      Note:

      Factor back before using Line 2.

    2. Review the return and attachments to determine the correct amount for column 1, Line(s) 5a, 5b, 5c or 5d (Revision 2013 and subsequent),

    3. If available, edit the correct amount for column 1, Line(s) 5a, 5b, 5c or 5d (Revision 2013 and subsequent),

    4. Continue to process the return.

    An identical entry appears on column 1 for Lines 5a, 5b, 5c and 5d (Revision 2013 and subsequent) or Lines 5a, 5b and 5c (Revision 2012 or prior),   Asterisk (*) to the left of the amount on Line 5b and 5d (Revision 2013 and later) or Line 5b (Revision 2012 or prior)
    An entry has been made on column 1, Line 5b, but no tax has been entered in column 2, Line 5b,  
    1. Review the return (including the entity) and attachments,

    2. Compare the column 1, Line 5b entry to the entries on Line(s) 3, 5a, 5c, 5d (Revision 2012 or prior) or 5a, 5c, and 5e (Revision 2013 and subsequent), 8, and 10, as applicable,

    3. If the Line 5b entry is equal to an amount on one of the lines referenced in Step 2, or if the box on Line 4 is checked, delete the entry in column 1, Line 5b. Place an asterisk (*) to the left of the entry,

    4. If the column 1, Line 5b entry is not equal to an amount for the lines referenced in Step 2, and the box on Line 4 is not checked, continue to process the return.

    Lines 5a, 5b, 5c (Revision 2012 or prior), or Lines 5a, 5b, 5c and 5d ( Revision 2013 and subsequent) Columns 1 and 2 are blank, zero, or "None" , Line 2 has an entry ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ (Domestic Only), or processing a foreign return,
    1. If the box on Line 4 is checked, edit CCC B and continue to process the return,

    2. If the box on Line 4 is not checked, review the return and any attachments to determine if the taxpayer is claiming to be "exempt" from Social Security and/or Medicare tax. If found, edit CCC "B" and continue to process the return. The taxpayer may claim to be exempt by indicating one of the following reasons:

      • The maximum Social Security tax has been paid

      • Wages for children under 18 years old

      • Minister wages

      • Railroad

      • United Transportation Union

      • Non-qualified Plan (Section 457 plan)

      • Church FICA issue

      • Foreign Employer with US employee

      Caution:

      Review any attachment closely for an indication of exemption from Social Security and Medicare tax when processing a foreign return.

    3. If there is no indication or reason given on the return or on any of the attachments, research IDRS for an Employment Code of C, F or G . If the Employment Code is a C, F or G, edit a CCC "B" , and continue to process the return.

    Lines 5a or 5b, column 1 shows a negative entry,   Asterisk (*) to the left of the negative amount and edit as a positive entry, left of the asterisk.

    Note:

    This will cause a math error notice to generate to the taxpayer.

    Social Security wages are shown on column 1, Line(s) 5a, or 5b, but columns 1 and 2, Line 5c (Revision 2018 or prior ) are blank, zero, dash, or "None" The box on Line 4 is not checked, (i.e. indicating wages are not subject to Social Security and/or Medicare tax)

    Note:

    If the Line 4 box is checked, see IRM 3.11.13.15.4, (Form 8274 Church Exempt from Social Security and Medicare Taxes),

    • Foreign Only:

      1. Add column 1 Line(s) 5a and 5b, and enter amount on Line 5c (Revision 2018 or prior), column 1 See Figure 3.11.13-27.

      2. Continue to process the return.

    Social Security wages are shown on column 1, Line(s) 5a or 5b, but column 1, Line 5c (Revision 2018 or prior), is blank, zero, dash, or "None" There is an entry on column 2, Line 5c ( Revision 2016 or prior)
    1. Divide the tax amount by the Medicare rate (.029).

    2. Edit the result to column 1, Line 5c (Revision 2018 or prior).

    3. Continue to process the return.

    An identical entry has been made on Line 5a (Column 1), Line 5b (Column 1) and Line 5c, (Column 1) but no entries appears on Line 5a (Column 2), Line 5b or Line 5c (Column 2) Line 2 has an entry ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ Asterisk (*) to the left of the amount on Line 5b
    Line 5d column 1 is blank (Revision 2013 and subsequent) There is an entry in column 2 (Revision 2013 and subsequent)
    1. Divide the tax amount by the Additional Medicare rate (.009)

    2. Edit the result to column 1, Line 5d (Revision 2013 and subsequent)

    Line 5d is blank ( Revision 2012 or prior) There are entries (or an entry) in column 2, of Lines 5a, 5b, or 5c ( Revision 2012 or prior) Add the entries from column 2, Lines 5a, 5b, or 5c and enter the calculated result on Line 5d (Rev 2012 or prior).
    Line 5d column 1 has an entry (Rev 2013 and subsequent) Line 5c, column 1 and 2 are blank Asterisk the amount on line 5d column 1 (Rev 2013 and subsequent) and enter the amount to line 5c, column 1
    Line 5e ( Revision 2013 and subsequent) is blank, There are entries (or an entry) in column 2 of Lines 5a, 5b, 5c and/or 5d ( Revision 2013 and subsequent), Add the entries from column 2, Lines 5a, 5b, 5c or 5d (Revision 2013 and subsequent ) and enter the calculated result on Line 5e (Revision 2013 and subsequent)
    There is no significant entry on Lines 5a, 5b, 5c or 5d (Revision 2018, or prior). Line 2 has an entry of ≡ ≡ ≡ ≡ ≡ ≡ ≡ , Do not correspond for Social Security/Medicare wages.

    Figure 3.11.13-26

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    Figure 3.11.13-27

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  2. Domestic Only - If the taxpayer indicates they employ family members, and the Line 2 entry represents the amount of their wages, but column 1, Lines 5a and column 1, 5c does not show an entry, then edit the Line 2 amount to column 1, Line 5a and 5c. DO NOT CORRESPOND.

  3. IRC § 3127 allows an employer and any employees, where both are members of a recognized religious sect or division, to elect to be exempt from Social Security and/or Medicare tax. To claim the exemption, they must file Form 4029, Application for Exemption from Social Security and Medicare Taxes and Waiver of Benefits, and describe the religious sect or division and indicate they adhere to its established tenets or teachings. Furthermore, though they may be exempt from Social Security and/or Medicare tax, the employer must withhold Federal income tax. Also, the employer must still withhold and pay the employee's share and pay the employer's share of Social Security and Medicare taxes for employees without an approved Form 4029. Form 4029, must be filed with and approved by the Social Security Administration. If the taxpayer has indicated, "Form 4029 Exempt" , or "Form 4029 Applicable" in the blank area or above Line 5a, do not question the difference between the Total Compensation Line and taxable Social Security/Medicare wages.

Line 5f, Section 3121(q) Notice and Demand -Tax Due on Unreported Tips (Revision 2013 and subsequent) or Line 5e (Revision 2011 and 2012)

  1. A Form 941 (Revision 2011 and 2012) may show a dollar amount on Line 5e or Line 5f (Revision 2016, 2015, 2014 and 2013) or, on return revisions prior to January 2011, show a line notated "3121(q)" with a dollar amount. The vast majority of these returns are from taxpayers who received a Section 3121(q) Notice and Demand following a tips examination. These employers must pay the employer portion of Social Security and Medicare taxes on unreported tips shown on the Section 3121(q) Notice and Demand. These taxpayers are instructed to report the tax liability on their Form 941 for the quarter in which the IRC § 3121(q) Notice and Demand is issued.

    1. Some returns may also be submitted voluntarily by the taxpayer without a tips examination being performed.

  2. Line 5f (Revision 2018, 2017, 2016, 2015, 2014 and 2013) or Line 5e (Revision January 2012 and 2011) is a transcription line. Accept taxpayer's figures as reported unless a Section 3121(q) Notice and Demand is attached indicating the amount should be higher. In that case asterisk the amount on Line 5f (Revision 2013 and subsequent) or Line 5e (Revision 2012 and 2011) and enter the higher amount shown on the Notice and Demand. The taxpayer may report more tax than what is indicated on the Notice and Demand. Do not reduce the amount.

    Caution:

    Entries on Line 5f (Revision 2018, 2017, 2016, 2015, 2014 and 2013) or Line 5e (Revision 2012 and 2011) are not common. If the entry on Line 5f (Revision 2013 and subsequent) or Line 5e (Revision 2012 and 2011) is the sum of Lines 3 and 5e (Revision 2013 and subsequent ) or Line 5d (Revision 2012 and 2011), asterisk the entry on Line 5f (Revision 2013 and subsequent) or Line 5e (Revision 2012 and 2011) as a “misplaced entry.”

Lines 6a - 6e, (Tax Periods 201006-201012)- Hiring Incentives to Restore Employment (HIRE) Act

  1. Qualified employers who hired unemployed workers between February 3, 2010, and January 1, 2011, may qualify for a 6.2 percent payroll tax incentive. The incentive, in effect, exempts the employers from their share of Social Security taxes on wages paid to these workers from March 19, 2010, through December 31, 2010. The payroll tax exemption applied to Form 941, Form 941-PR, and Form 941-SS. This payroll tax exemption will have no effect on the employee's future Social Security benefits, and employers are still required to withhold the employee's 6.2 percent share of Social Security as well as income taxes. The employer and employee's shares of Medicare taxes would also still apply to any wages paid.

    Note:

    Taxable businesses and tax-exempt organizations qualify for the retention credit. Qualified employers in all five U.S. territories (i.e., American Samoa, Commonwealth of the Northern Mariana Islands, Puerto Rico, etc.) that are subject to social security tax also qualify for the retention credit. Federal, state and local government employers generally do not qualify for the retention credit. However, public colleges and universities can qualify. Indian tribal governments also qualify.

  2. Lines 6a-6e are all transcription lines. Accept the taxpayer's figures for Lines 6a through 6d (Revision 2010) . See IRM 3.11.13.14.10 for Line 6e procedures (Tax Periods 201006 through 201012)

  3. The HIRE Act was not extended beyond 12/31/2010. Therefore, Form 941, Form 941-PR, and Form 941-SS (Revision 2011) were revised by shading out lines 6a through 6d.

  4. If a taxpayer uses a Form 941, Form 941-PR, or Form 941-SS prior revision to file for a quarter in year 2010 quarter and enters on line(s) 6a through 6d an entry, disallow the entry by placing an asterisk to the left of the amount. Then, make any needed corrections down the remainder of the return.

Line 6e, (Tax Period 201003 through 201112) -Total Taxes Before Adjustments

  1. Line 6e, Total Taxes Before Adjustments, (Revision 2010 ) for tax periods 201003 through 201112 is the sum of lines 3, 5d, and 5e. This is a T-Line. Compute the total if blank, zero dash or none.

  2. The entry should be positive and entered in dollars and cents.

  3. If present as a negative amount, convert to a positive amount.

Line 6, Total Taxes Before Adjustments (Tax Periods 201203 and subsequent, 201003 and Prior)

  1. Line 6, (Tax Periods 2012 and subsequent) represents Total Taxes Before Adjustments. This is a T-Line. Compute the total if blank, zero dash or none.

  2. Line 6, (Tax Periods 201003 and prior (Domestic Only)) represents Total Taxes Before Adjustments, but it was not a T-Line. However, it may be necessary to compute this line in the following instances:

    IF THEN
    Line 6 is blank, (Revision 2010 and prior) Compute only if needed to compute the Line 8 amount (Revision 2010 and prior)
    Line 6 (Revision 2010 and prior) contains an entry, Accept the taxpayer’s entry.

Line 7, (Tax Period 201103 and subsequent) -Current Quarter's Adjustments for Fractions of Cents

  1. An entry on line 7 can be positive, negative or minus on Form 941, Form 941-PR, or Form 941-SS.

  2. The entry on line 7 does not require any substantiation or supporting statement. Therefore, accept all taxpayer entries on this line.

  3. If the taxpayer's entry is correct and in dollars only, the examiner should not re-enter the amount in dollars and cents.

Line 7, Tax Adjustments – General (Revision 2010 and prior)

  1. Entries on line 7a through 7c (Revision 2010 and prior) represent adjustments (e.g., Fractions of cents, Sick Pay, Group Term Life Insurance or Tips) to the net tax of the Form 941 being filed.

  2. Revision 2005 through 2008 also had lines 7d through 7g for additional adjustments (e.g., Federal Income Tax Withholding, Social Security and Medicare Tax, Special Additions to Federal Income Tax Withholding, and Special Additions for Social Security and Medicare) to the Form 941 tax.

  3. If an examiner enters an amount to one of the adjustment lines, the entry should be in dollars and cents. However, if a taxpayer's entry is in dollars only and is correct, the examiner should not re-enter the amount to dollars and cents.

Line 7a, Fractions of Cents, (Revision 2005-2010)
Line 7b, Sick Pay, (Revision 2005-2010)
Line 7c, Adjustments for Tips and Group-Term, (Revision 2005-2010)
  1. Entries on Lines 7a, 7b, or 7c can be positive, negative or minus amounts.

  2. An entry on Line 7a, 7b, or 7c does not require a Form 941-X for substantiation. Therefore, accept the taxpayer’s entry.

    Note:

    If Form 941-X is attached to Form 941, see IRM 3.11.13.17 for processing procedures.

  3. Accept a Social Security tax adjustment on Line 7b identified as "sick pay" or "disability payment" . The employer will show the employers share of Social Security tax paid by a third-party. If the return is being filed by the third-party payer, the employers share of Social Security tax on sick pay will be shown on Line 7b.

  4. If an examiner enters an amount to Line(s) 7a through 7c, they should enter it in dollars and cents. However, if a taxpayer's entry is correct and in dollars only, the examiner should not re-enter the amount in dollars and cents.

Line 7d, Total Adjustments (Revision 2009 and Feb. 2010)
  1. The taxpayer's entry in Line 7d, Total Adjustments, represents the total of the amount(s) entered on Lines 7a through 7c.

  2. If there is an amount on one or more of the Line(s) 7a through 7c, but an amount is not shown on Line 7d, do not add Lines 7a through 7c. Leave Line 7d blank as the return was submitted.

  3. Verify an amount on Line 7d by subtracting Line 6 from Line 8.

    1. If the amount on Line 7d is incorrect, edit an asterisk (*) to the left of the amount on Line 7d.

    2. Enter the resulting of Line 8 minus Line 6 to the left of asterisk on Line 7d. If entering a computed result that is a negative, also edit a minus (-).

Line 7d, Current Year Federal Income Tax Withholding (Domestic Only) (Revision 2005- 2008)
  1. A taxpayer may show an adjustment to correct an error made in:

    1. A prior quarter(s) in a different tax year(s), or

    2. A preceding quarter of the same tax year (TY).

  2. Entries on Line 7d can be positive, negative or a minus (-) amount.

  3. Perfect Line 7d as follows: Note: All line references refer to SCRIPS Form 941, Form 941-PR, Form 941-SS (Revision 2005 through 2008)

    IF AND THEN
    The taxpayer has an entry on Line(s) 7d, 7h and 8, it is a decrease, negative or minus amount, Process the adjustment using the procedures in (4) below.
    The taxpayer has an entry on Line(s) 7d, 7h and 8, it is an increase amount, Process the adjustment using the procedures in (5) below.
    The taxpayer has an entry on Line 7d, Meets all of the following conditions:
    • Entered the same amount on Line(s) 3 and 7d,

    • Provided no explanation or substantiation for the entry on Line 7d, and

    • The entry on Line 7d is not included on Line(s) 7h or 8, or Line(s) 7h or 8 are blank,

    Consider the entry on Line 7d as an incorrect entry. Place an asterisk (*) to the left of entry and continue to process the return.
  4. Process a decrease in Federal Income Tax Withholding to correct errors as follows:

    Note:

    All line references refer to SCRIPS Form 941, Form 941-PR and Form 941-SS (Revision 2005 through 2008)

    IF AND THEN
    A decrease amount is shown on Line 7d, The taxpayer has NOT provided a Form 941-X, supporting statement,
    1. Asterisk (*) to the left of the adjustment amount,

    2. Edit the Form 941 with an Action Trail "CP102/94X" ,

      Note:

      This will cause the return to fall out to ERS; the Action Trail will indicate to the ERS Tax Examiner the correct Taxpayer Notice Code (TPNC) to use when generating the notice to the taxpayer that an X Adjusted Return is needed to process the adjustment.

    3. Continue to process the return.

  5. Process an Increase in Federal Income Tax Withholding - Accept any increases in Federal Income Tax Withholding whether or not a Form 941-X, supporting statement, or explanation is attached. If a Form 941-X is attached, verify that the correct entry is shown on Line 7d, (Revision 2005 through 2008) of the return.

Line 7e, Prior Quarters Social Security and Medicare Taxes (Revision 2005 through 2008)
  1. Adjustments to Social Security and Medicare tax may be made on a Form 941 for tax period 2005 through 2008, provided the tax period being adjusted is not barred by Statute. See IRM 3.11.13.34.

  2. See IRM 3.11.13.17, 94X Adjusted Return Procedures, when there is:

    • A prior year (PY) revision (2008 and prior) filed for a 2009 and subsequent Tax Period showing an amount on Line 7e

    • A Form 941 with a Form 941-X or Form 941-X(PR) attached

  3. Perfect Line 7e, as follows:

    Note:

    All line references refer to SCRIPS Form 941, Form 941-PR and Form 941-SS (Revision 2005 through 2008)

    IF AND THEN
    The taxpayer has an entry on Lines 7e, 7h, and 8, is a decrease, negative or minus amount, Process the adjustment using the procedures in (4) below.
    The taxpayer has an entry on Lines 7e, 7h and 8, is an increase amount, Process the adjustment using the procedures in (5) below.
    The taxpayer has an entry on Line 7e, meets all of the following conditions:
    • Same amount on Lines 2 or 5d and 7e,

    • No explanation or substantiation provided for adjustment,

    • The entry on Line 7e is not included on Line(s) 7h or 8, or Line(s) 7h or 8 are blank,

    Consider the entry on Line 7e as an incorrect entry and place an asterisk (*) to the left of the entry. Continue to process the return.
  4. Process a Decrease in Social Security and Medicare Tax as follows:

    Note:

    All line references refer to SCRIPS Form 941, Form 941-PR and Form 941-SS (Revision 2005 through 2008)

    IF AND THEN
    A decrease amount is shown on Line 7e, The taxpayer has NOT provided a, Form 941-X, supporting statement,
    1. Asterisk (*) to the left of the adjustment amount,

    2. Edit the Form 941 with an Action Trail "CP102/94X" ,

      Note:

      This will cause the return to fall out to ERS; the Action Trail will indicate to the ERS Tax Examiner the correct Taxpayer Notice Code (TPNC) to use when generating the notice to the taxpayer that an X Adjusted Return is needed to process the adjustment.

    3. Continue to process the return.

  5. Process an increase in Social Security and Medicare Tax - Accept any increases in Social Security and Medicare Tax Adjustment whether or not a Form 941-X, supporting statement, or explanation is attached. If a Form 941-X is attached, verify that the correct entry is shown on Line 7e of the return.

Line(s) 7f, Special Additions to Federal Income Tax (Domestic Only), and 7g, Special Additions to Social Security and Medicare (Revision 2005 through 2008)
  1. An amount on Line(s) 7f, Special Additions to Federal Income tax, and 7g, Special Additions to Social Security and Medicare Tax, represents a correction of income tax (on Line 7f) or Social Security and Medicare tax (on Line 7g) due to a prior Compliance (Examination) review assessment.

  2. See IRM 3.11.13.17, 94X Adjusted Return Procedures, when:

    • A prior year (PY) revision (2008 and prior) filed for a 2009 and subsequent tax period showing an amount on Line 7f or 7g

    • A Form 941 with a Form 941-X or Form 941-X(PR) attached

  3. Any amounts entered on Line 7f or 7g should be in dollars and cents.

    Note:

    All line references refer to SCRIPS Form 941, Form 941-PR and Form 941-SS (Revision 2005 through 2008)

    IF THEN
    There is an entry on Line(s) 7f or 7g Determine the tax period of the return the taxpayer is filing.
    The tax period was in tax year 2009 and subsequent Edit an asterisk (*) to the left of the entry on Line 7f and/or 7g. Also edit an Action Trail, "CP 102 94X"
    The tax period is in tax year 2008 or prior, Determine whether the entry on Line 7f or 7g was mathematically included in the amount appearing on Line 7h, (or if 7h is blank), Line 8.
    The entry on Line 7f or 7g was mathematically included in an amount appearing on Line 7h, (or if 7h is blank), Line 8, Edit an asterisk to the left of the adjustment amount on Line 7f and/or 7g, also an Action Trail “CP102 94X ”.
    The entry on Line 7f or 7g was not mathematically included in the amount appearing on Line 7h, (or if 7h is blank), Line 8, Review the return and attachments for the adjustment on Line(s) 7f or/and 7g.
    1. If Line 7h is blank, consider the entry on Line 7f and/or 7g to be an erroneous entry. Asterisk (*) to the left of the entry (or entries) and continue to process the return. Note: This will cause the return to fall out to Error Resolution.

Line 8, (Tax Period 201103 and subsequent) Current Quarter's Adjustment for Sick Pay

  1. An entry on line 8, (tax period 201103 and subsequent) represents the current quarter's adjustment to sick pay.

  2. Accept any Social Security and Medicare tax adjustment on Line 8 identified as "sick pay" or "disability payment" . The employer will show their share of Social Security tax paid by a third-party. If the return is being filed by the third-party payer, the employer's share of Social Security tax on sick pay will be shown on Line 8.

  3. If the taxpayer's entry is correct and in dollars only, the examiner should not re-enter the amount in dollars and cents.

  4. If the taxpayer entered the same amount on Lines 8, 9 or Line 10 (Revision 2016 or prior) or Line 12 (Revision 2017-2018), verify the amount on Line 10 (Revision 2016 or prior) or Line 12 (Revision 2017-2018) by following the instructions on the form itself and entered the correct amount on Line 8.

Line 8, Total Taxes after Adjustment, (Revision 2005- 2010)

  1. Verify a negative amount on line 8 (Revision 2005 - 2010) by following the directions on the form.

  2. Line 8 must be entered if it is blank or contains a misplaced entry.

    Example:

    Taxpayer has listed zero on Line 8, however Lines 3 and 5 have entries, asterisk the zero and enter correct amount.

    Exception:

    If entering Column(s) 1 or 2 for Line(s) 5a, 5b, or 5c, do not compute line 8.

  3. If Lines 8 and 9 are blank and there is an entry on Line 10, enter the Line 10 amount on Line 8. See Figure 3.11.13-28.

    Figure 3.11.13-28

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Line 9, (Tax Period 201103 and subsequent) Current Quarter's Adjustment for Tips, Group Life Ins.

  1. An entry on line 9, (tax period 201103 and subsequent) represents the current quarter's adjustment for tips or group term-life insurance.

  2. Accept a Social Security tax adjustment on Line 9 identified as "tips" or "term life insurance" . The employer will show their share of Social Security tax paid by a third-party. If the return is being filed by the third-party payer, the employer's share of Social Security tax on tips or group term-life insurance will be shown on Line 9.

  3. If the taxpayer's entry is correct and in dollars only, the examiner should not re-enter the amount in dollars and cents.

Line 9, Advance Earned Income Credit (Domestic Only) (Tax periods 201012 and prior)

  1. The Advanced Earned Income Credit (AEIC) was a tax credit for certain employees in the United States. Eligible employees could choose whether to claim the whole credit on their tax return (Form 1040), or receive part of the credit in advance through their pay during the year and claim the remainder of the credit on their tax return (Form 1040). The employer may or may not have to make a tax deposit during the quarter. Therefore, do not assume that AEIC is a misplaced entry if there is no deposit(s). This largely applies to small dollar returns. If the Total Taxes minus the AEIC equals the Net Taxes do not move the AEIC entry.

  2. AEIC distribution through the employer was repealed by the Education Jobs and Medicaid Assistance Act beginning in Tax Period 201103 and subsequent.

  3. Process Line 9 (Revisions 1012 and Prior only) entry as follows:

    IF THEN
    The tax period for Form 941 began after December 31, 2010,
    1. Asterisk (*) to the left of the amount on Line 9.

    2. Asterisk (*) to the left of the amount on Line 10. Enter the correct amount from Line 8 to the left line 10.

    The Line 9 entry is negative or is other than for Advance Payment of Earned Income Credit ( EIC), (e.g., Net Tax entered on Line 9 rather than Line 10),
    1. Review the return to determine if there is an incorrect line entry,

    2. If so, place an asterisk (*) to the left of the amount and, if needed, edit the entry to the correct line,

    3. If the entry is correct, but should not have a negative sign, parenthesis or brackets, edit an asterisk to the left of the entry and edit the amount as a positive amount to the left of the asterisk.

    The Line 9 entry is equal to Line 8 and Line 10, and is clearly a misplaced entry, Place an asterisk (*) to the left of the Line 9 entry. Figure 3.11.13-29
    Line 9 shows the correct entry, but the amount is larger than the entry on Line 8, Total Taxes,
    1. Asterisk (*) to the left of the amount on Line 9. To the left edit the same amount appearing on Line 8, Total Taxes,

    2. Determine the difference between the amount on Line 8, Total Taxes and the taxpayer's entry on Line 9, AEIC,

    3. Add the calculated amount to the taxpayer's entry on Line 11, Total deposits for the quarter. Edit the new amount to Line 11. Figure 3.11.13-30

    Line 8 is larger than Line 10, and Line 9 is blank, Compute Line 9 by subtracting Line 10 from Line 8. Enter the total on Line 9.
    The Line 9 entry is negative and has been added to Line 8 (Line 10 is larger than Line 8), Compute Lines 12 or 13 which ever is applicable, by using the absolute value (Do not use the minus value) of Line 9 added to Line 11 and subtracted from Line 8.
    The return liability (Line 10 Revision 2005-2010) is $50,000 or more, and the Line 9 amount is equal to the Schedule B total, but greater than $2,500.00, ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡

    Figure 3.11.13-29

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    Figure 3.11.13-30

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Line 10, (Revision 2011 and Subsequent)-Total taxes after adjustments

  1. Line 10, (Revision 2012 and subsequent), Total taxes after adjustment is the sum of Line 6 or (Line 6e, Revision 2011), Total Taxes Before Adjustments, Line 7, Current quarter's adjustment for fractions of cents, Line 8, Current quarter's adjustment of sick pay, and Line 9, Current quarter's adjustment of tips and group-term life insurance.

  2. Line 10 is a T-line (for year 2011 thru 2016). For year 2017-2018, Line 10 will not be transcribed, however it may be necessary to compute this line. Thus, Line 10 must be entered if it is blank or contains a misplaced entry. Prior to year 2011, line 10 was not transcribed or captured.

    IF THEN
    Line 10 (Revision 2017-2018) is blank, Compute only if needed to verify or compute line(s) 11,13,14 or 15.
    Line 10 (Revision 2011-2016) is blank,

    Exception:

    If entering Column(s) 1 or 2 for Line(s) 5a, 5b, 5c or 5d, do not compute line 10.

    Add Lines 6 (Revision 2012 through 2016) or Line 6e (Revision 2011), 7, 8, and 9. Edit the result on Line 10.
    Line 10 (Revision 2011-2016) contains a zero, but there are entries on Lines 3, 5e, 5f, 6 and/or 6e,

    Exception:

    If entering Column(s) 1 or 2 for Line(s) 5a, 5b, 5c or 5d, do not compute line 10.

    Asterisk the zero and compute the correct amount. Edit the result on Line 10.
    Line 10 contains an entry, Accept the taxpayer's entry. Use the taxpayer's entry, if needed, to verify or compute Line 13, 14, or 15.
  3. Entries can be positive, negative or minus and must appear in dollars and cents.

  4. Verify a negative amount on line 10 ( Revision 2011 and subsequent) by following the directions on the form.

Line 10, Total taxes after adjustment for advance EIC (Domestic Only, Revision 2010 and prior)

  1. Line 10, Total taxes after adjustment for advance EIC, should be the total of Line 8, Total taxes after adjustments, less Line 9, Advance earned income credit.

  2. Line 10 is not a T-line, however it may be necessary to compute this line.

    1. IF THEN
      Line 10 is blank (2005–2008 Revision) Compute only if needed to verify or compute Line(s) 11, 12 or 13.
      Line 10 is blank (2005–2008 Revision) Compute if needed to determine if SIC should be edited to the return.
      Line 10 contains an entry (2005-2008 Revision) Accept the taxpayer's entry. Use the taxpayer's entry, if needed, to verify or compute Line 11, 12 or 13.
      IF THEN
      Line 10 is blank (2009 or 2010 Revision), Compute only if needed to verify or compute Line(s) 11, 13, 14 or 15.
      Line 10 is blank (2009 or 2010 Revision), Compute if needed to determine if SIC should be edited to the return.
      Line 10 contains an entry (2009 or 2010 Revision), Accept the taxpayer's entry. Use the taxpayer's entry, if needed, to verify or compute Line 11, 13, 14, or 15.

Line 11, Qualified small business payroll tax credit for increasing research activities. Attach Form 8974 (Revision 2017-2018)

  1. Process Line 11 as follows:

    IF AND THEN
    Line 11 is blank Form 8974 is attached
    1. Consider the F8974 as a loose Form.

    2. Detach the F8974 and Route to your local Image Control Team (ICT).

    3. Continue processing the return.

    There is an entry on Line 11 Form 8974 is attached Edit CCC Q bottom center margin.
    There is an entry on Line 11 Form 8974 is not attached. Edit Action Code 211 and correspond using Letter 21C paragraph S to request the F8974.
    Line 11 and Line 10 have the same amount   Delete Line 11 as a misplaced entry.
    The entry on Line 11 does not match the entry on Line 12 Form 8974.   Edit an asterisk (*) to the left of the amount on Line 11 and enter the amount from Line 12 Form 8974 to Line 11 Form 941, 941-SS or 941-PR.
    The entry on Line 11 is more than Line 10 Line 12 and Line 13 are blank
    1. Determine the difference between the amount on Line 10, Total taxes after adjustments and the taxpayer entry on Line 11, payroll tax credit,

    2. Add the calculated amount to the taxpayers entry on Line 12, Total taxes after adjustment and credits,

    3. Edit the overpayment amount from Line 12, Total taxes after adjustment and credits to Line 13, Total deposits for this quarter including overpayment

    The taxpayer has used Form 941 Revision 2017-2018 for a 201612 or prior tax period There is an entry on Line 11
    1. Delete the amount on Line 11 as a misplaced entry and edit the amount to Line 13 as Total Deposits if not already there,

    2. Re-compute Line 12 if necessary

Line 11, Total Deposits for This Quarter, (Revision 2005 - 2008, 2014-2016)
Line 12, Balance Due (Revision 2005 - 2008, 2014-2016)
Line 13, Overpayment, (Revision 2005 - 2008, 2014-2016)

  1. Process Lines 11 through 13 as follows:

    Note:

    All line references refer to SCRIPS Form 941, Revision 2005 through 2008, 2014-2016. For SCRIPS Form 941, Revision 2009 through 2013, see IRM 3.11.13.14.21.

    IF AND THEN
    Line 11 is blank, the Taxpayer has indicated on an attachment total deposits for quarter Edit the amount to Line 11.
    Line 11 is equal to or less than Line 10, Line 12 is blank, zero, dash or none Compute Line 12. Use the entries on Lines 10 and 11.
    Line 10 and 11 are the same, There is a different amount on Line 12, Adjust Line 11. See Figure 3.11.13-31.
    Line 10 and 11 are the same, There is a different amount on Line 13, Verify the Line 10 entry from above, Correct Line 10 as necessary and compute Line 13 using the NEW Line 10 amount and Line 11.
    Lines 11 and 12 have the same amount   Delete Line 11 as a misplaced entry. Figure 3.11.13-32
    Lines 11, 12 and 13 have the same amount, Line 10 is more than Line 11, Place an asterisk (*) to the left of Line 13.
    Lines 11, 12 and 13 have the same amount, Line 10 is less than Line 11, Place an asterisk (*) to the left of Line 12.

    Figure 3.11.13-31

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    Figure 3.11.13-32

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  2. Compare Line 10 and 11 (Revision 2005 - 2008, 2014-2016) If Line 9 and 10 (Revision 2005 - 2008, ) are blank, compare Lines 8 and 11 (Revision 2005 - 2008, ). Enter the difference on Line 12 or 13 (Revision 2005 - 2008, 2014-2016), whichever is appropriate. See Figure 3.11.13-33.

    Figure 3.11.13-33

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    Note: All line references refer to SCRIPS Form 941, Revision 2005 through 2008 and Revision 2014-2016.

    IF AND THEN
    Line 11 shows a negative (minus) amount,   Asterisk (*) the Line 11 amount and enter the Line 10 amount on Line 12.
    Line 12 or 13 shows a negative (minus) amount,  
    1. Verify the negative entry as a positive entry, by adding the entries leading to the amount. If the entry is correct edit the amount as a positive entry.

    2. If the entry cannot be verified, use Line 10, if Line 10 is blank use Line 8 and Line 9. Also if Line 11 has an entry figure the difference, and enter on Line 12 or Line 13.

    There are entries on both Lines 12 and 13,   Asterisk (*) to the left of the incorrect entry. See Figure 3.11.13-34.
    The entry on Line 12 belongs on Line 13, The taxpayer indicates that he/she expects a refund by putting parenthesis around the amount on Line 12, or by checking the "Refund" box or "Applied to Next Return" box below Line 13, Asterisk (*) to the left of the Line 12 amount and enter that amount on Line 13. See Figure 3.11.13-35.

    Figure 3.11.13-34

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    Figure 3.11.13-35

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Line 11, Total Deposits for this Quarter, including overpayment applied from a prior quarter and overpayment applied from Form 941-X or Form 944-X
Line 12a, through Line 12e (Revision 2009 through 2013)

  1. COBRA gives employees who lose coverage under the employer's group health plan, due to a qualifying event, the right to elect to continue that coverage (under COBRA) for a period of time by paying premiums. COBRA covers multi-employer health plans and health plans maintained by private sector employers with 20 or more employees. It does not apply to churches or certain religious organizations.

  2. The premium assistance also applies to temporary continuation coverage elected under the Federal Employees Health Benefits Program and to continuation coverage under State programs that provide for coverage comparable to COBRA continuation coverage.

  3. A federal subsidy of 65 percent of the COBRA premium is available to assistance eligible individuals. The subsidy is available for up to fifteen months.

  4. The employer computes the COBRA amount and provides the number of eligible COBRA assistance payment individuals on Lines 12a and 12b These lines are available on Form 941 returns, Revision 2009 through 2013.

    1. Assistance eligible individuals who elect COBRA continuation coverage are treated as having paid the required COBRA premium if the individual elects COBRA and pays 35 percent of the COBRA premium.

    2. The 65 percent of the premium not paid by the assistance eligible individual is reimbursed to the employer maintaining the group health plan through a credit against payroll taxes.

    3. The employer reports the 65 percent premium assistance provided to assistance eligible individuals on their employment tax return once the 35 percent of the premium is paid by or on behalf of the assistance eligible individual.

    4. The credit is treated as a deposit made on the first day of the return period which reduces the employer's employment tax liabilities. Employers can apply the credit to offset their federal tax deposits, to generate a refund, or both.

  5. Hiring Incentives to Restore Employment (HIRE) -Lines 12c through 12e are used by the employer to compute the credit earned during the first quarter 2010. (For an explanation of the HIRE credit, see IRM 3.11.13.14.9.). The first quarter 2010 credit could only be claimed on 2nd quarter 2010 returns.

Line 11, Total Deposits for this Quarter, including overpayment applied from a prior quarter and overpayment applied from Form 941-X or Form 944-X
Line 12a, COBRA Premium Assistance Payments (Revision 2009 through 2013),
Line 12b, Number of Recipients who Received COBRA Premium Assistance Payments and (Revision 2009 through 2013),
Line 13, Subtotal (Revision 2009 through 2013)
  1. If there is an attachment to the Form 941, (including a SCRIPS Form 941), showing COBRA computation, and the taxpayer has not completed Line 12a and/or 12b, (Revision 2009 through 2013) review the attachment for the missing information.

    1. If the missing information is shown on the attachment, edit the information to the appropriate Line(s) 12a and/or 12b.

    2. If the missing information is not available, correspond for the missing information. Use Form 13195 with the applicable paragraph. Remember to edit the left margin of the return with the Letter 21C paragraphs.

  2. Process Line 11 through 13 as follows: Note: All line references refer to Form 941 (Revision 2009 through 2013).

    IF AND THEN
    Line 11 is blank, zero, dash or "none" The taxpayer has attached a statement indicating total deposits Edit the amount to Line 11.
    Lines 11 and 12a are blank, The amounts on lines 13 and 14 are the same, Asterisk (*) the amount on line 13.
    Lines 11 and 12a are blank, The amounts on lines 13 and 14 are different, Edit the line 13 amount to line 11.
    An amount is shown on Line 12a that is equal to the amount on Line 10, Line 11 is blank, zero, dash or none
    1. Edit an asterisk to the left of Line 12a,

    2. Edit the amount from Line 12a to Line 11,

    3. Also edit the Line 12a amount to Line 13 if blank.

    An entry is shown on Line 12a other than zero, dash or none Line 12b is blank, zero, dash or none, Correspond for Line 12b.
    An entry is shown on Line 12b other than zero, dash or none, Line 12a is blank, zero, dash or none Correspond for Line 12a.
    The entry on Line 12b is the same as the entry on Line 1, Line 12a is other than blank, zero, dash or "none" , Correspond for Line 12b.

    Note:

    If there is an indication on the return or attachment that "No Employees for the quarter" or "No wages paid this quarter " . Do not correspond for Line 12b. Accept the entry.

    The entry on Line 12b is the same as the entry on Line 1, Line 12a is blank, zero, dash or "none" , Edit an asterisk (*) to the left of the Line 12b entry.
    The entry on Line 12b is not in a numeric format,   Edit an asterisk (*) to the left of the entry and edit the numeric equivalent to the left of the asterisk.

    Exception:

    Notations of "zero" , "none" or "blank" do not need to be converted to a numeric equivalent.

    Line 11 and 13 are the same amount, Are the same amount as Line 10 and 14 or 15, Consider Line 11, 13 and 15 as misplaced entries and edit an asterisk (*) to the left of the entries. See Figure 3.11.13-36.
    An amount is shown on line 13, Lines 11, 12a, 14 and 15 are blank, Edit the line 13 amount to line 11 .
    Line 13 is blank, zero, dash, or "none" , There are entries on Line 11 and/or 12a Edit Line 13 using the entry from Line 11 and 12a (compute Line 13 by adding Line 11 and 12a ). See Figure 3.11.13-37.
    An amount is shown on Line 13, There are entries on Line 11 and 12a
    1. Verify the amount on Line 13 by adding Line 11 and 12a.

    2. If the amount on Line 13 is incorrect, edit an asterisk (*) to the left of the amount and edit the correct amount to the left of the asterisk.

    See Figure 3.11.13-38.
    A negative amount is shown on Line 11 and 12a, Line 13 has a positive or negative amount,
    1. Verify the amount on Line 13 as a positive entry, by adding Line 11 and 12a as a positive amount.

    2. Line 13 is correct as a positive amount, edit Line 11, 12a and 13 as positive entries.

    3. Line 13 is not correct, correspond for an explanation of the entry on Line 13. Also, correspond for Line 12b if needed.

    Line 12c 12d and/or 12e has entries The tax period is not 201006 Asterisk the figures on Line 12c, 12d, and/or 12e . Otherwise accept the taxpayers figures.

    Figure 3.11.13-36

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    Figure 3.11.13-37

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    Figure 3.11.13-38

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Form 941, Line 12 -Total taxes after adjustments and credits(Revision 2017-2018)
  1. Process Line 12 as follows:

    IF THEN
    Line 12 is blank , zero, dash or none Subtract line 11 from Line 10 and enter the amount on Line 12.
    Lines 11 and 12 have the same amount Delete Line 11 as a misplaced entry.
Line 13, Total deposits for this quarter, including overpayment applied from a prior quarter and overpayments applied from Form 941-X, 941-X (PR), 944-X, or 944-X(SP) filed in the current quarter (Revision 2017-2018)
Line 14, Balance Due (Revision 2017-2018)
Line 15, Overpayment, (Revision 2017-2018)
  1. Process Line 13 through 15 as follows:

    Note:

    All line references refer to SCRIPS Form 941, Revision 2017-2018

    IF AND THEN
    Line 13 is blank, zero, dash or none The taxpayer has attached a statement indicating total deposits Edit the amount to Line 13.
    Line 13 is equal to or less than Line 12, Line 14 is blank, zero, dash or none Compute Line 14. Use the entries on Lines 12 and 13.
    Line 12 and 13 are the same, There is a different amount on Line 14, Adjust Line 13.
    Line 12 and 13 are the same, There is a different amount on Line 15, Verify the Line 12 entry from above, if correct, delete Line 15.
    Line 12 and 13 are the same, There is a different amount on Line 15, Verify the Line 12 entry from above, Correct Line 12 as necessary and compute Line 15 using the NEW Line 12 amount and Line 13.
    Lines 13 and 14 have the same amount   Delete Line 13 as a misplaced entry.
    Lines 13, 14 and 15 have the same amount, Line 12 is more than Line 14, Place an asterisk (*) to the left of Line 15.
    Lines 13, 14 and 15 have the same amount, Line 12 is less than Line 14, Place an asterisk (*) to the left of Line 14.
    Line 13 shows a negative (minus) amount,   Asterisk(*) the Line 13 amount and enter the line 12 amount on line 14.
    Line 14 or 15 shows a negative (minus) amount  
    1. Verify the negative entry as a positive entry, by adding the entries leading to the amount. If the entry is correct edit the amount as a positive entry.

    2. If the entry cannot be verified, use Line 12, if Line 12 is blank use Line 10 and Line 11. Also, if Line 13 has an entry figure the difference, and enter on Line 14 or Line 15.

    There are entries on both Lines 14 and 15.   Asterisk (*) to the left of the incorrect entry.
    The entry on Line 14 belongs on Line 15 The taxpayer indicates that he/she expects a refund by putting parenthesis around the amount on Line 14, or by checking the Refund box or Applied to Next Return box below Line 15, Asterisk (*) to the left of the Line 14 amount and enter that amount on Line 15.
Line 14, Balance Due and Line 15, Overpayment (Revision 2009 through 2013)
  1. Process Line 14 and 15 as follows: Note: All line references refer to Form 941, Revision 2009 through 2013

    IF AND THEN
    Line 14 and 15 are blank, zero, dash or "none" , Line 13 is blank, zero, dash or "none" , Edit the Line 10 amount to Line 14.
    Line 14 and 15 are blank, zero, dash or none Line 10 is more than the amount on Line 13, Subtract Line 13 from Line 10 and enter the amount on Line 14. See Figure 3.11.13-39.
    Line 14 and 15 are blank, zero, dash or none Line 13 is more than the amount on Line 10, Subtract Line 10 from Line 13 and enter the amount on Line 15.
    There are entries on both Line 14 and 15, Line 10 is more than the amount on Line 13, Edit an asterisk (*) to the left of the incorrect entry on Line 15.
    There are entries on both Line 14 and 15, Line 13 is more than the amount on Line 10, Edit an asterisk (*) to the left of the incorrect entry on Line 14. See Figure 3.11.13-40.
    Line 10, 11, 13 and 14 are the same,   Consider Line 11 and 13 as misplaced entries and edit and asterisk (*) to the left of the entries.
    The entry on Line 14 belongs on Line 15 and the amount on Line 13 is more than the amount on Line 10, The taxpayer indicates a refund is due by placing parentheses around the amount on Line 14, or by checking the "Refund" box or "Apply to next return" box, Edit an asterisk (*) to the left of the amount on Line 14 and edit the amount to Line 15.
    A negative amount is shown on Line 14 and entries are shown on Line 10 and/or 13, If Line 13 is blank, zero, dash or "none" , Edit the Line 10 amount to Line 14.
    A negative amount is shown on Line 14 and entries are shown on Line 10 and/or 13, Line 10 is more than the amount on Line 13, Subtract Line 13 from Line 10 and enter the amount on Line 14.
    A negative amount is shown on Line 14 and entries are shown on Line 10 and/or 13, Line 13 is more than the amount on Line 10, Subtract Line 10 from Line 13 and enter the amount on Line 15.

    Figure 3.11.13-39

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    Figure 3.11.13-40

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Line 16, State Deposit Code (Revision 2009 through 2011), or Line 14, (Revision 2005- through 2008)

  1. The taxpayer enters a State Deposit code on the return to indicate that their deposits were made to a bank in a State, other than the State shown in the entity address on the front of the return. Thus, edit the State Deposit Code when the taxpayer has entered the full name of the State, or when the State abbreviation is other than one on the list. Exhibit 3.11.13-11. for more information.

  2. However, beginning January 1, 2012 due to a change in the law, only holidays recognized by banks within the District of Columbia, will alter FTD computation for all filers. The change affects Form 941 returns for year 2012 and subsequent tax periods.

Line 14, Monthly Summary of Federal Tax Liability (Revision 2014, 2015 and 2016), Line 16, Monthly Summary of Federal Tax Liability (Revision 2012, 2013 and 2017-2018), Line 17, Monthly Summary of Federal Tax Liability (Revision 2009 through 2011 ) and Line 15, Monthly Summary of Federal Tax Liability, (Revision 2005 through 2008) or Schedule B (ROFTL) - Schedule Indicator Code (SIC)

  1. Monthly schedule depositors complete Line 14 (Revision 2016, 2015, 2014), Line 16 (Revision 2012, 2013, 2017 and 2018) (Line 17, Revision 2009 through 2011, or Line 15 Revision 2005 through 2008), Monthly Summary of Federal Tax Liability, to show their monthly tax liability. Semi-weekly schedule depositors complete Schedule B, Report of Tax Liability for Semiweekly Schedule Depositors, to show their weekly and monthly tax liability. The Record of Federal Tax Liability (ROFTL) is comprised of one or both of the above.

  2. The Schedule Indicator Code (SIC) is used by Code and Edit to remove the requirement for data entry to capture the ROFTL information when it is determined the ROFTL is unnecessary incomplete or outside of the tolerance

  3. Edit the applicable SIC on the Form 941, Form 941-PR or Form 941-SS (Revision 2005 and subsequent) right margin, at the end of "Part 1: Answer these questions for this quarter" line. SIC 1, 2 and 3 are valid as follows:

    Reminder:

    The "Conditions" are for tax periods beginning 01-01-2005 and subsequent. (The line number references relate to the Form 941, Form 941-PR or Form 941-SS revision indicated.)

    SIC CODE CONDITIONS
    1 Edit SIC 1 When:
    1. Line 10 (Revision 2016 and prior) or Line 12 (Revision 2017-2018) is less than $2,500.00.

    2. Line 10 (Revision 2016 and prior) or Line 12 (Revision 2017-2018) is $2,500.00 or more and the ROFTL is incomplete or blank

    3. The return shows all zeros or is non-taxable.

    4. A negative or minus (-) amount appears in the ROFTL (Form 941, Line 14 (Revision 2015, 2014, 2016), Line 16, Revision 2012, 2013, 2017 and 2018, Line 17 Revision 2009 through 2011, or Line 15 Revision 2005 through 2008 and/or Schedule B).

    5. Taxpayer completes only the "Total Liability for Quarter, " and does not complete "Month 1" and "Month 2" and "Month 3" boxes.

    6. Taxpayer completes only Total Liability for Quarter on Schedule B. (Rest of Schedule B is blank)

    7. Return prepared under IRC§ 6020(b).

    2 A statement of "Unbanked Taxpayer" is attached, Line 10 is $2,500.00 or more,

    Note:

    Edit SIC “1”, not “2” if Line 10 is less than $2500

    3 " Church FICA Issue" or "Church Social Security Issue" notated. For procedures on processing returns indicating "Church FICA Issue" or "Church Social Security Issue" See IRM 3.11.13.15.5.
  4. In determining if a SIC code should be edited:

    Schedule Indicator Code (SIC) 1 Editing

    IF THEN
    For Revision 2010 and prior: Line 9 and Line 10 is blank, Use the Line 8 amount
    For Revision 2010 and prior: Line 9 has an amount, Compute the amount for Line 10
    For Revision 2011 and subsequent: Line 10 (Revision 2016 or prior) or Line 12 (Revision 2017-2018) is blank,
    • Compute Line 10 (Revision 2016 or prior) . If Lines 7, 8, and 9 are blank, bring the Line 6 or (Line 6e, Revision 2011) amount to Line 10.

    • Compute Line 12 (Revision 2017-2018). If Lines 7,8,9, and 10 are blank, subtract Line 11 from Line 6 and enter the amount on Line 12.

     

Perfecting Line 14 (Revision 2016, 2015, 2014), Line 16 (Revision 2012, 2013, 2017 and 2018), Line 17 (Revision 2009-2011), Line 15, (Revision 2005- through 2008 ) and Schedule B (ROFTL)

  1. Edit a SIC Code on a return using the criteria and procedures above. If more than one code should be entered, enter the code in the priority order: 1, 2,3.

  2. If no SIC will be edited, edit the money fields.

    1. All transcription lines must be edited in dollars and cents.

    2. If there are no entries in the ROFTL liability fields, review the return and attachments. If the ROFTL liability entry (or entries) are available, edit the ROFTL and/or Schedule B with the correct entry (or entries) and do not edit a SIC 1.

  3. If there are multiple deposit amounts on the same line, then asterisk the entry. Add the amounts and enter the resulting amount to the left of the asterisk.

    Note:

    Do not follow this procedure if you are editing SIC 1.

  4. If the taxpayer completes more than one Schedule B, combine the Daily Tax Liabilities from each Schedule B to one Schedule B and line through (/) the Schedules B that are not to be entered.

  5. If the taxpayer inadvertently places an entry on Schedule B in an incorrect last day of the month, (e.g., the 29th of February, except in a leap year, or the 31st day of April, June, September or November), asterisk the entry and enter the amount to the last valid day for that month. If an entry already exists in that field, add the amounts together.

Line 15 (Revision 2016, 2015, 2014), Line 16 (Revision 2014 and subsequent), Line 17 (Revision 2012, 2013, 2017 and 2018), Line 18 (Revision 2009 through 2011) and Line 16 (Revision 2016, 2015, 2014 ), "Final Return" check box, and "Final date you paid wages" , Line 18 (Revision 2012 and 2013), Line 19 (Revision 2009 through 2011) and Line 17 (Revision 2008 and Prior), Seasonal Employer check box

  1. If the taxpayer has checked the "If your business has closed and you stopped paying wages" box, edit a CCC "F" .

  2. If the taxpayer indicates in another location on the return, or in an attachment, that the return being filed is their final return with a notation such as (but not limited to) Final, Out of Business, No Longer Have Employees, Deceased, Liquidation, Dissolved, etc. then the "Final Return" box on Line 15 (Revision 2016, 2015, 2014) or Line 16 (Revision 2014 and subsequent) or Line 17 (Revision 2012, 2013, 2017 and 2018, Line 18 Revision 2009 through 2011, or Line 16 Revision 2008 and Prior) should be checked and a date when final wages were paid should have been provided.

    Note:

    Do not edit CCC "F" , if the date of Final Wages is after the last day of the return's tax period.

  3. If the taxpayer did not check the box, the Code and Edit examiner should check the box and edit a CCC "F" in the designated location.

  4. If the taxpayer did not provide a date when final wages were paid, and the return shows tax data, correspond for the Date of Final Wages and DO NOT edit CCC "F" . Otherwise, if the return shows no tax data, edit CCC "F" and DO NOT correspond for the Date of Final Wages unless you are corresponding for a missing signature.

  5. If the Seasonal Employer box is checked, edit CCC "T" in the designated location on the return.

  6. If the taxpayer has checked the "Seasonal Employer" box and is indicating the return being filed is their final return, by either checking the "Final Return" box or a notation on the return or on an attachment, Edit CCC "T" to the return and only edit CCC "F" if the date of final wages is given and the date of the final wages is before the last day of the tax period.

    Note:

    If CCC "F" is being edited to the return Do Not edit CCC "T" .

  7. If the taxpayer indicates they are a seasonal employer in another location on the return or in an attachment, edit CCC "T" in the designated location and check the box on Line 16 (Revision 2016, 2015 and 2014 ) or Line 18 (Revision 2012, 2013, 2017 and 2018, Line 19, Revision 2009 through 2011, or Line 17 Revision 2008 and Prior), if not already checked.

Conversion Procedures for Form 941, (Revisions 08 and Prior),

  1. This section provides guidelines to convert and process Form 941 returns through ISRP.

    • Form 941, Revision 2008 or prior with /or without attachments (other than Schedule B or Schedule R), needs to be renumbered to February 2010 Revision (e.g., 201003).

  2. When the Form 941, Form 941-PR, or Form 941-SS claims COBRA, e.g., indicates an amount on the applicable return line (Revision 2005 through 2008), or indicates on an attachment to the return of a COBRA entry, the Form 941 can be processed using the lines on the February 2010 revision (Tax Period 201003).

    Note:

    For revisions 2005 through 2008, renumber the return lines to match the Revision February 2010 Revision (Tax period 201003).

  3. If SIC 1 is edited to the return, it is not necessary to renumber the ROFTL.

  4. Always edit the tax period in YYMM format:

    • Form 941 (Revision 2004 and prior) - edit above the OMB box.

    • Form 941 (Revision 2005 through 2008)- edit above the "Report for the quarter of ..." box.

  5. Correspond for the signature if not present, and edit Action Code 225.

    Note:

    For signature procedures, see IRM 3.11.13.11.7.

Form 941, Employer's Quarterly Federal Tax Return, Form 941-PR, Planilla Para La Declaracion Federal Trimestral Del Patrono and Form 941-SS, Employer's Quarterly Federal Tax Return (Revision 2004 and prior) Return - Conversion Format and Line Editing

  1. The 2004 revision (and prior) of Form 941 received in Document Perfection should be processed as follows:

    1. All 2004 and prior returns must be edited using the February 2010 Form 941 revision, unless the taxpayer claims HIRE credit. If HIRE credit is being claimed by the taxpayer, the examiner should edit the Form 941 using the October 2010 revision. See Exhibit 3.11.13-4, for Revision 2004 and prior Road Map.

    2. If Form 941 Revision 2004 is received with an amount on Line 4, Line 9 or Line 12 (for tax periods after 12/31/2010), then asterisk the amount. This will allow the return to fall out in ERS for corrections to be made.

  2. If a period prior to 200903 return is received with COBRA information, asterisk the amount to disallow and prevent the entries from being processed.

Form 94X - Adjusted Employment Tax Return and Claim for Refund

  1. Employment Tax Return Filers are required to file a Form 94X, Adjusted Return or Claim for Refund, to correct prior filings of their Employment Tax Returns.

  2. The 94X Forms are designed to be filed as a stand-alone return and should not be filed with an Employment Return. The 94X returns will be processed by Accounts Management (AM). A 94X return has been designed to correct each Employment Tax Return:

    Employment Tax Returns 94X - Adjusted Employment Tax Return and Claim for Refund
    941 and 941-SS 941-X: Adjusted Employer's QUARTERLY Federal Tax Return or Claim for Refund
    941-PR 941-X (PR): Ajuste a la Declaración Federal TRIMESTRAL del Patrono o Reclamación de Reembolso
    943 943-X: Adjusted Employer's Annual Federal Tax Return for Agricultural Employees or Claim for Refund
    943-PR 943-X (PR): Ajuste a la Declaración Federal Anual del Patrono de Empleados Agricolas o Reclamación de Reembolso
    944 944-X: Adjusted Employer's ANNUAL Federal Tax Return or Claim for Refund
    944(SP) 944-X (SP): Ajuste a la Declaracion Federal ANUAL del Empleador o Reclamacion de Reembolso
    945 945-X: Adjusted Annual Return of Withheld Federal Income Tax or Claim for Refund
    CT-1 CT-1X: Adjusted Employer's Annual Railroad Retirement Tax Return or Claim for Refund
  3. An Employment Tax Return (Revision 2009 and subsequent) with Forms 94X attached, process as follows (sight verify the Employment Return only):

    IF THEN
    The Employment Tax Return does not reflect an amount shown on the 94X/CT-1X return or it cannot be determined if an adjustment is being taken on the Employment Tax Return,
    1. Detach the 94X/CT-1X return,

    2. Photocopy page 1 of the Employment Tax Return and attach to the back of the Form 94X return

    3. Edit Action Trail on the Employment Tax Return, "94X to AM" , "CT-1X to AM" , or

    4. Attach to Form 94X/CT-1X - Form 3465, in remarks field edit "ADJ NOT PROCESSED"

    5. Continue processing the return.

    The taxpayer indicates on the 94X/CT-1X return an adjustment amount has been taken on the Employment Tax Return or there is an indication on the Employment Tax Return of an adjustment that is not allowable,
    • Review the 94X/CT-1X return to determine if the adjustment is allowed on the Employment Tax Return by reviewing the explanation .

      1. Adjustment Allowable on the Employment Tax Return

        Note:

        "Allowable" refers to Fractions of Cents, Sick Pay, and Adjustments for Tips and Group-term Life Insurance.

        1. If the adjustment is allowable on the Employment Tax Return line through (/) the 94X/CT-1X return to indicate adjustment taken on the Employment Tax Return, leave the 94X attached as an attachment and continue to process the return.

      2. Adjustment NOT Allowable on the Employment Tax Return

        Note:

        Adjustment NOT allowable on the Employment Tax Return are errors discovered on or after January 1, 2010 that require justification and the Tax Period in which the adjustment is being made is 2009 and subsequent.

        1. Edit an asterisk (*) to the left of the adjustment line,

        2. Edit the Employment Tax Return with Action Trail "94X to AM" , or "CT-1X to AM" .,

          Note:

          By placing an asterisk next to the adjustment amount will cause the return to fall out to ERS. The Action Trail will indicate to the ERS Tax Examiner the correct Taxpayer Notice Code (TPNC) to use to generate the notice advising the taxpayer the adjustment will be processed by Accounts Management.

        3. Edit CCC "X" ,

          Note:

          This will stop any refund from going out while the adjustment is being processed.

        4. Photocopy Page 1 of the Employment Tax Return, attach to the back of Form 94X/CT-1X and attach Form 3465, in remarks field edit "ADJ NOT PROCESSED" ,

        5. Continue processing the return.

  4. If an Employment Tax Return (Revision 2008 and prior), is received with a 941X, Adjusted Employment Tax Return and the tax period of the 941 return is the same tax period as the Employment Tax Return, route to Accounts Management as an Amended Return. See Figure 3.11.13-41

    1. Figure 3.11.13-41

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    Note:

    Renumber "Total Adjustments" line as necessary. Do not recalculate the Total Adjustment Amount.

    IF AND THEN
    The Employment Tax Return does not reflect an amount shown on the 94X/CT-1X return,  
    1. Detach the 94X/CT-1X return

    2. Photocopy page 1 of the Employment Tax Return and attach to the back of the 94X return,

    3. Edit Action Trail on the Employment Tax Return, "94X to AM" , "CT-1X to AM" ,

    4. Attach to Form 94X/CT-1X - Form 3465, in remarks field edit "ADJ NOT PROCESSED" ,

    5. Continue processing the return.

    An amount is shown on an adjustment line(s) of the Employment Tax Return that require justification and a 94X/CT-1X return is attached,  
    1. Asterisk (*) to the left of the adjustment line,

    2. Edit the Employment Tax Return with an Action Trail "94X to AM"

      Note:

      This will cause the return to fall out to ERS; the Action Trail will indicate to the ERS Tax Examiner (TE) the correct Taxpayer Notice Code (TPNC) to use when generating the notice to the taxpayer that the adjustment will be processed by Accounts Management (AM).

    3. Edit CCC "X" ,

      Note:

      This will stop any refund from going out while the adjustment is being processed.

    4. Photocopy Page 1 of the Employment Tax Return, attach to the back of the 94X/CT-1X return and attach Form 3465, in remarks field edit "ADJ NOT PROCESSED" ,

    5. Continue processing the return.

    An Amount is shown on the adjustment line(s) of the Employment Tax Return that require justification and a 941X return is NOT attached, Increase Amount
    1. Asterisk (*) to the left of the adjustment amount,

    2. Edit the Employment Tax Return with an Action Trail "ADJ TO AM" ,

      Note:

      This will cause the return to fall out to ERS; the Action Trail will indicate to the ERS Tax Examiner (TE) the correct Taxpayer Notice Code (TPNC) to use when generating the notice to the taxpayer that the adjustment will be process by Accounts Management (AM).

    3. Edit CCC "X" ,

    4. Photocopy the Employment Tax Return and attach Form 3465, in remarks field edit "ADJ NOT PROCESSED" . See Figure 3.11.13-42.

    5. Continue processing the return.

    An Amount is shown on the adjustment line(s) of the Employment Tax Return that require justification and a 941X return is NOT attached, Decrease Amount
    1. Asterisk (*) to the left of the adjustment amount,

    2. Edit the Employment Tax Return with an Action Trail "CP 102 94X" ,

      Note:

      This will cause the return to fall out to ERS; the Action Trail will indicate to the ERS Tax Examiner (TE) the correct Taxpayer Notice Code (TPNC) to use when generating the notice to the taxpayer that an "X" Adjusted Return is needed to process the adjustment.

    3. Continue processing the return.

    Figure 3.11.13-42

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  5. A Non-Taxable 941 return received with "Misclassified Employee" written in the top margin and/or Form 941-X attached, See IRM 3.11.13.10.3

Substitute Form 941 Filed by Federal Agencies For Employers

  1. Federal agencies making wage determinations withhold income taxes and the employee's share of FICA taxes from payments made to employees. The federal agency reports and pays the employee share of FICA with an employment tax return filed with the IRS. The agencies allowed to take this action are:

    • National Labor Relations Board (NLRB) - Labor Management Relations Act

    • Department of Labor (DOL) - Fair Labor Standards Act

    • General Accounting Office (GAO) or Housing and Urban Development (HUD) - Davis-Bacon Act

  2. The agency prepares a Form 941 for each quarter showing the total wages reported on lines 2, 5a, 5c and 5d of Form 941 and the full amount of tax is computed. The employer's share of FICA is then deducted on line 7 of the Form 941. If wages are not collected, "no liability" returns are to be filed.

    1. A consolidated Form 941-X should be attached to the federal agency's Form 941. The consolidated Form 941-X will reflect the aggregate wages and tax withheld for all employees for which wage determinations were made by the federal agency for that tax period.

    2. In the explanation area, the agency indicates the name of the agency and the Act which authorizes them to collect and pay back wages.

    3. The Form 941-X is stamped "Do Not Transmit to SSA".

  3. Process the Form 941 using the procedures in this IRM. These returns do not require special processing.

    1. If the return indicates a final return, input CCC "F" .

    2. No signature is required for these returns.

    3. Do not separate the Form 941-X from the Form 941.

Form 943, Annual Tax Return for Agricultural Employees and Form 943-PR, Planilla para la Declaración Anual de la Contribución Federal del Patrono de Empleados Agrícolas - General

  1. Form 943 is an annual return filed by employers to report Social Security and Medicare tax and Income Tax Withheld from agricultural employees. Form 943-PR is an annual return filed by employers to report Social Security and Medicare tax for agricultural employees whose principal place of business is in Puerto Rico. The tax applies if:

    1. Any employee is paid cash wages of $150.00 or more for farm work,

    2. The total (cash and noncash) wages paid to all farm workers is $2,500.00 or more.

  2. For Tax year 2017, we have two new lines- Line 12 (Qualified small business payroll) and Line 13 now asks for total taxes after adjustments and credits.

  3. For tax year 2014 the COBRA Lines will not be processed. Lines 13a, 13b, and 14 will remain on Form 943, but the text for these lines will be removed, a gray shaded area will be inserted in the entry spaces, and the text "Reserved" will be added as a placeholder.

  4. Beginning tax year 2013 a new line 6, "Total Wages Subject to Additional Medicare Tax Withholding" and line 7 Additional Medicare Tax Withholding was added. Employers are required to begin withholding Additional Medicare tax in the pay period in which they pay wages in excess of $200,000 to an employee and continue to withhold it each pay period until the end of the calendar year. Section 3101(b)(2), as added by P.L. 111-148, sections 9015 and 10906, and further amended by section 1402 (b) of P.L. 111-152.

  5. Domestic and Foreign consideration of Form 943

    IF THEN
    An employer has a principal address in any of the 50 U.S. States, or the District of Columbia, Taxpayer should file Form 943. The taxpayer should mail the return (according to the Form 943 instructions) to:
    • Cincinnati Submission Processing Center (CSPC), or

    • Ogden Submission Processing Center (OSPC)

    An employer with a foreign (International ) address, or the address is not one of the 50 U.S. states, the District of Columbia, or Puerto Rico, Taxpayer should file Form 943. The taxpayer should mail the return (according to the Form 943 instructions) to Ogden Submission Processing Center (OSPC).
    An employer has a principal place of business in Puerto Rico, Taxpayer should file Form 943-PR. The taxpayer should mail the return (according to the Form 943-PR instructions) to Ogden Submission Processing Center (OSPC).
  6. Foreign Return Processing:

    1. All Forms 943 with a foreign address or an address of an U.S. possession and 943-PR should be processed at the Ogden Submission Processing Campus (OSPC). If these returns are received in any other Submission Processing Campus, they must be transshipped to OSPC. Army Post Office (APO), Fleet Post Office (FPO) and Diplomatic Post Office (DPO) are not considered foreign addresses.
      • If the return is unnumbered, withdraw it from the batch and prepare Form 13195 requesting the Letter 86C be sent to the taxpayer. Attach a Form 4227 for routing to OSPC.
      • If the return is numbered, use AC 650.

    2. Form 943-PR is similar to Form 943. However, they contain Social Security and Medicare tax only. Therefore, the line numbers must be the same as the domestic returns. If they are not, alter the numbers to make them compatible with the transcription lines for that year.

    3. Withheld Income Tax should not be reported on Form 943 with a foreign address or an address of an U.S. possession. However, certain filers are subject to the withholding tax because they employ U.S. citizens. If such taxpayers include the withholding tax and/or withholding tax adjustments on the returns (such as showing the amounts in the shaded areas):

      Note:

      The following procedures will change the Filing Requirement from a Form 943-PR to a Form 943 filer. Care should be taken before entering this change:


      • Code a numbered return with AC 620 for Reject processing.
      • Prepare a substitute return for the erroneous foreign return if the return is unnumbered.
      • Prepare and release promptly a Form 2363, (Master File Entity Change), to change the BMF filing requirement code from "6" or "7" to "1" .

    4. Otherwise, the instructions provided for Form 943 returns filed with foreign or American possession addresses) should be followed to the extent possible to process these returns. Specific procedures for these returns are:
      • An address change may be made on the returns if it will not change the Filing Requirement Code from "6" to "7" or "1" , or from "7" to "1" or "6" . Otherwise, a Form 2363 must be prepared showing TC 013.
      • See IRM 3.11.13.12.1 for instructions to follow regarding the Name Control and see the Name Control Job Aide, Document 7071A for determining a Name Control.

    5. Do not send these returns back for missing signature, initiate letter 21C.

  7. If a revision year 2009 or prior is received, renumber the lines as the 2010 revision. See tables below.

    Form 943 (Revision 2008 and prior)  
    Line 1 through Line 6 No changes
    Line 7 Renumber to Line 7d
    Line 8 through Line 12 No changes
    Line 13 Renumber to Line 15
    Line 14 Renumber to Line 16
    Line 15 Renumber to Line 17
    Form 943, Revision 2009  
    Line 1 through Line 6 No changes
    Line 7 Renumber to Line 7d
    Line 8 through Line 17 No changes

    If the taxpayer has an amount on Line 10 of the form (Revision 2010 or prior), Advance Earned Income Credit, edit an asterisk (*) to the left of the amount . Advance Earned Income Credit can no longer be claimed on Form 943 beginning with tax year 2011.

  8. Computer Condition Codes (CCC) should be edited in the bottom center margin of the return, if required. See IRM 3.11.13.12.2 for Computer Condition Code (CCC) Procedures.

  9. Finalizing Form 943: A final wage date is not required on Form 943. Enter CCC F if the taxpayer gives any positive indication that he/she is filing a final return. See IRM 3.11.13.11.3, Non-Taxable Returns With No Line Entries.

    Reminder:

    Remember to visually check the final return box for an entry which is located on the left hand side of the return below the entity box on the first page. Enter an "F" in the bottom margin if the box is checked.

  10. Edit all entries in DOLLARS AND CENTS unless otherwise directed.

  11. There are no provisions for processing an early filed return, e.g., tax year (TY) 2018 filed before the end of the calendar year (CY). It must be held until the first cycles of the next year. Edit Action Code 480, and continue to process the return.

  12. A payment voucher is attached to the bottom portion of the Form 943. These vouchers should be detached by the contractor Lockbox operation (or the Deposit function, if received in the Campus) for proper processing of any remittance. Blank vouchers attached to the form may be detached and disposed. However, vouchers with data present should be left attached to the form.

  13. Form 943/943 PR Schedule R :

    1. A Schedule R Indicator (SRI) "R" will generate when Schedule R (Form 943/943PR), Allocation Schedule for Aggregate Form 943 Filers or Schedule R Continuation Sheet is attached to Form 943’s.

    2. Forms 943 and 943-PR with a Schedule R attached must have the Schedule R Indicator code edited in the right margin of the return next to Line 7.

      Note:

      All Forms 943/943 PR with a Schedule R attached must be batch separately. Pull all the 943 returns with the Schedule R attached from the regular batch and rebatch for processing in ISRP.

Examining Form 943 Return Data

  1. If any entry on a transcription line is not legible, place an asterisk (*) to the left of entry and enter the correct data.

  2. Following are the Line Item Descriptions for Form 943 Revisions 2010 and subsequent. See Exhibit 3.11.13-5 for the transcriptions lines for the current Form 943.

    Line Item Description Form 943 (Revision 2010) Form 943 (Revision 2011-2012) Form 943 (Revision 2013) Form 943 (Revision 2016-2015-2014) Form 943 (Revision 2017)
    Number of agricultural employees Line 1 Line 1 Line 1 Line 1 Line 1
    Total wages subject to Social Security tax Line 2 Line 2 Line 2 Line 2 Line 2
    Social Security Tax
    • For years 2015, 2014, 2013, 2010 and prior (12.4%)

    • For year 2011 and 2012 (10.4%)

    Line 3 Line 3 Line 3 Line 3 Line 3
    Total wages subject to Medicare tax Line 4 Line 4 Line 4 Line 4 Line 4
    Medicare tax (2.9%) Line 5 Line 5 Line 5 Line 5 Line 5
    Total Wages Subject to Additional Medicare Tax Withholding     Line 6 Line 6 Line 6
    Additional Medicare Tax Withholding (.009)     Line 7 Line 7 Line 7
    Federal Income Tax Withheld Line 6 Line 6 Line 8 Line 8 Line 8
    Number of qualified employees paid wages after March 31, 2010 Line 7a        
    Exempt wages paid to qualified employees after March 31, 2010 Line 7b        
    Social Security Tax exemption (6.2%) Line 7c        
    Total taxes before adjustments Line 7d Line 7 Line 9 Line 9 Line 9
    Current year's adjustments Line 8 Line 8 Line 10 Line 10 Line 10
    Total taxes after adjustments Line 9 Line 9 Line 11 Line 11 Line 11
    Qualified small business payroll tax credit for increasing research activities. Attach Form 8974...         Line 12
    Advance earned Income credit Line 10        
    Net Taxes Line 11        
    Total deposits Line 12 Line 10 Line 12 Line 12  
    Total taxes after adjustments and credits. Subtract line 12 from line 11.         Line 13
    COBRA premium assistance payments Line 13a Line 11a Line 13a Line 13a (Reserved)  
    Number of individuals provided COBRA premium assistance payments Line 13b Line 11b Line 13b Line 13b (Reserved)  
    Number of qualified employees paid exempt wages March 19 through 31. Line 13c        
    Exempt wages paid to qualified employees March 19 through 31 Line 13d        
    Social security tax exemption (6.2%) Line 13e        
    Add lines:
    • For year 2011 and subsequent, line 10 and 11a

    • For year 2010, lines 12, 13a, and 13c.

    Line 14 Line 12 Line 14 Line 14 (Reserved)  
    Total deposits for 2017, including overpayment applied from a prior year and Form 943-X         Line 14
    Balance due Line 15 Line 13 Line 15 Line 15 Line 15
    Overpayment Line 16 Line 14 Line 16 Line 16 Line 16
    Monthly summary of Federal tax liability Line 17A through 17M Line 15A through 15M Line 17A through 17M Line 17A through 17M Line 17A through 17M
    Third Party Designee Below Line 17 Below line 15 Below line 17 Below line 17 Below Line 17
    Signature Sign Here line Sign Here line Sign Here line Sign Here line Sign Here line
    Paid Preparer Use Bottom of form Bottom of form Bottom of form Bottom of form Bottom of form

State Deposit Code

  1. The taxpayer enters a State Deposit code on the return to indicate that their deposits were made to a bank in a State, other than the State shown in the entity address on the front of the return. This State entry is used when computing a Federal Tax Deposit penalty to integrate State banking holidays into the computation.

  2. Beginning Tax Year 2012 (Revision 2012) the text regarding the use of the state code box and the state code box for where deposits are made has been removed. Only legal holidays in the District of Columbia can delay a deposit.

Line 1, Number of Agricultural Employees

  1. Perfect the line for validity only. All alpha words must be written in numeric form, edit an asterisk (*) to the left of the alpha word and edit the numeric equivalent to the left of the asterisk. If the numeric equivalent cannot be determined asterisk (*) to the left of the entry on Line 1.

    Exception:

    Notations of "zero" , "none" and "blank" do not need to be converted to a numeric equivalent.

Line 2, Total Social Security Wages and Line 3, Tax on Social Security Wages

  1. Edit Line(s) 2 and 3 using the following procedures:

    IF THEN
    Line 2 is blank, zero, dash or "none" , and Line 3 has an entry,
    1. Take the amount on Line 3 and multiply it by the appropriate factor in the table in Exhibit 3.11.13-12 or divide the tax amount by the Social Security tax rate (.124 (Revision 2017,2016, 2015, 2014, 2013), or for year 2012-2011 .104). Enter the result on Line 2. See Figure 3.11.13-43,

    2. The taxable wages (Line 2) may be determined from other information on the return or from attachments,

    3. Continue to process the return.

    Line 2 and Line 3 are blank, zero, dash or "none" and there is an amount on Line 4 (If Line 4 is also blank, zero, dash or" none" , see (2) below,
    1. Edit the amount of the Line 4 Medicare wages to Line 2,

    2. Continue to process the return.

    Note:

    If Line 3 is needed to compute another line (i.e. Line 7( Revision 2012-2011 or Line 9 (Revision 2017, 2016, 2015, 2014, 2013), then multiply the Line 2 amount by .124 (Revision 2013), or for year 20122011, .104, and enter the amount on Line 3.

    Figure 3.11.13-43

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  2. If Line 2 cannot be perfected from the procedures in (1), then correspond with taxpayer using Paperless Correspondence Procedures in Exhibit 3.11.13-17 or Form 13195. Review the return or attachments for any of the following:

    IF AND THEN
    The taxpayer indicates they employ family members,   Correspond for Lines 2, 3, 4 or 5.
    The taxpayer believes wages to be exempt, The taxpayer does not provide a justifiable explanation why the wages are exempt, but the amount of the wages can be determined, Include the amount on Lines 2 and 4.
    Line(s) 2 and /or 4 have an entry, Lines 3 and 5 are blank, The taxpayer provides an explanation of exempt wages (e.g., religious order, employer's children under age 18), Reduce the amount of Line(s) 2 and/or 4 by the amount of the exempt wages.
    Lines 2, 3, 4 and 5 are blank, It can be determined that remittance was filed with the return, from the return or attachments,
    1. Suspend the return with Action Code 211.

    2. Use Paperless Correspondence Procedures or Prepare a Form 13195 to correspond for the necessary line items. See Figure 3.11.13-44.

    Figure 3.11.13-44

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Line 4, Total Medicare Wages and Line 5, Tax on Medicare Wages

  1. Edit Line(s) 4 and 5 as follows:

    IF THEN
    Line 4 is blank, zero, dash or "none" , and there is an amount on Line 5,
    1. Divide the tax shown on Line 5 by the Medicare rate (2.9%) or multiply Line 5 tax by the appropriate factor,

    2. Enter the amount on Line 4.

    Lines 4 and 5 are blank, zero, dash or "none" , Edit the amount on Line 2 to Line 4.

Line 6 (Revision 2017, 2016,2015,2014, 2013), Total Wages Subject to Additional Medicare Tax Withholding

  1. Process Line 6 as follows:

    IF THEN
    Line 6 (Revision 2017, 2016, 2015, 2014, 2013) is blank, zero, dash or "none" , and Line 7 (Revision 2017, 2016, 2015, 2014, 2013) has an entry,
    1. Divide the tax shown on Line 7 (Revision 2017, 2016, 2015, 2014, 2013) by the Additional Medicare Tax Withholding (.009)

    2. Enter the amount on Line 6 (Revision 2017, 2016, 2015, 2014, 2013).

Line 7 (Revision 2017, 2016, 2015, 2014, 2013), Additional Medicare Tax Withholding

  1. Process Line 7 as follows:

    IF THEN
    Line 7 (Revision 2017, 2016, 2015, 2014, 2013) is blank, zero, dash or "none" Multiply the total wages reported on line 6 (Revision 2017, 2016, 2015, 2014, 2013) by 0.9% and enter the amount on line 7 (Revision 2017, 2016, 2015, 2014, 2013)

    Note:

    Compute only if needed to verify the amount on Line 9.

Line 8, Federal Income Tax Withheld (Revision 2017, 2016, 2015, 2014, 2013), Line 6 (Revision 2012 and prior), Federal Income Tax Withheld (Domestic Only)

  1. Process Line 8 (Revision 2017, 2016, 2015, 2014, 2013) or Line 6 (Revision 2012 and prior) as follows:

    IF THEN
    Line 8 (Revision 2017, 2016, 2015, 2014, 2013) or Line 6 (Revision 2012 and prior) is blank, and it is apparent the amount has been entered on Line 9 (Revision 2017, 2016, 2015, 2014, 2013) or Line 7 (Revision 2012 and prior), Enter the amount on Line 8 (Revision 2017, 2016, 2015, 2014, 2013) or Line 6 (Revision 2012 and prior). See Figure 3.11.13-45.
    Line 8 (Revision 2017, 2016, 2015, 2014, 2013) or Line 6 (Revision 2012 and prior) is blank and Lines 3 and 5 (Revision 2012 and prior) do not equal Line 7 (Revision 2012 and prior) or Lines 3,5,7 and 8 (Revision 2017, 2016, 2015, 2014, 2013) do not equal Line 9 (Revision 2017, 2016, 2015,2014, 2013), Subtract Lines 3, 5 and 7 from Line 9 (Revision 2017, 2016, 2015, 2014, 2013) and put on Line 8 (Revision 2017, 2016, 2015,2014, 2013) or subtract Lines 3 and 5 from Line 7 (Revision 2012 and prior) and put on Line 6 (Revision 2012 and prior). See Figure 3.11.13-46.

    Figure 3.11.13-45

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    Figure 3.11.13-46

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Line 7a - 7d, Hiring Incentives to Restore Employment (HIRE) Act (Revision 2010)

  1. For tax year 2010, qualified employers who hire unemployed workers (after February 3, 2010, and before January 1, 2011) may qualify for a 6.2 percent payroll tax incentive. In effect, the legislation exempted them from their share of Social Security taxes on wages paid to these workers from March 19, 2010, through December 31, 2010. This reduced rate will have no effect on the employee's future Social Security benefits, and employers are still required to withhold the employee's 6.2 percent share of Social Security as well as income taxes. The employer and employee's shares of Medicare taxes also still apply to any wages paid.

    Note:

    Taxable businesses and tax-exempt organizations qualify for the retention credit. Qualified employers in all five U.S. territories (i.e., American Samoa, Commonwealth of the Northern Mariana Islands, Puerto Rico, etc.) that are subject to social security tax also qualify for the retention credit. Federal, state and local government employers generally do not qualify for the retention credit. However, public colleges and universities can qualify. Indian tribal governments also qualify.

  2. Lines 7a - 7d were transcription lines. Accept taxpayers figures.

  3. For tax year 2011 and subsequent, lines 7a through 7c were eliminated from the Form 943 and Form 943-PR due to the legislation expiring. Line 7d for tax year 2010 was changed to line 7 for tax year 2011.

Line 9, Total Taxes Before Adjustment, (Revision 2017, 2016, 2015, 2014, 2013), Line 7, Total Taxes Before Adjustments, (Revision 2011-2012).

  1. The entry on line 9, (Revision 2017, 2016, 2015, 2014, 2013) or Line 7, Form 943 (Revision 2011-2012) should be the total amount of lines 3, 5 and 6, e.g., (lines 3+5+6= line 7 (Revision 2011-2012) or the total amount of lines 3,5, 7 and 8 (Revision 2017, 2016, 2015, 2014, 2013), e.g. ( lines 3+5+7+8=line 9 (Revision 2017, 2016, 2015, 2014, 2013). On Form 943-PR (Revision 2011-2012), the line 7 entry is the total of lines 3 and 5, e.g., (lines 3+5 = 7). Compute Line 9 if blank, zero, dash or none, (Revision 2017, 2016, 2015, 2014, 2013) or Line 7 (Revision 2011-2012).

  2. The entry should be a positive amount.

Line 10, Current Year's Adjustment (Revision 2017, 2016, 2015, 2014, 2013), Line 8, Current Year's Adjustments (Revision 2009 through 2012)

  1. The entry on Line 10 (Revision 2017, 2016, 2015, 2014, 2013) or Line 8 (Revision 2009 through 2012) can be positive, negative or a minus amount.

  2. An entry of Line 10 (Revision 2017 , 2016, 2015, 2014, 2013) or Line 8 (Revision 2009 through 2012) does not require a support statement for substantiation.

    Note:

    Form 941C cannot longer be processed. If Form 941C is attached to a Form 941, Form 941-SS, Form 943, or Form 945, keep the package together and move the Form 941C to the front, staple and send it back to Accounts Management. If Form 943-X is attached, refer to IRM 3.11.13.17Form 94X - Adjusted Employment Tax Return and Claim for Refund

Line 8, Adjustment to Taxes (Revision 2008 and prior)

  1. Any Form 943 received for tax periods 2008 and prior with Form 941C attached can no longer be processed. If Form 941C is attached to a Form 941, Form 941-SS, Form 943, or Form 945, keep the package together and move the Form 941C to the front, staple and send it back to Accounts Management.

Line 11, Total Taxes after Adjustment (Revision 2017, 2016, 2015, 2014, 2013), Line 9, Total Taxes after Adjustments (Revision 2009 through 2012)

  1. Line 11 is a T-line (for years 2013 thru 2016). For year 2017 and subsequent, Line 11 will not be transcribed, however it may be necessary to compute this line. Thus, Line 11 must be entered if it is blank or contains a misplaced entry.

  2. Process the entry on Line 11 (Revision 2017, 2016, 2015, 2014, 2013) or Line 9 (Revision 2009 through 2012) as follows:

    IF THEN
    Line 11 (Revision 2017) is blank, Compute only if needed to verify or compute line(s) 12,,14, 15 or 16.
    ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ ≡ Math verify the amount on line 11 (Revision 2016, 2015, 2014, 2013) or line 9 (Revision 2009- 2012) to ensure the total shown equals line 9 (Revision 2017, 2016, 2015, 2014, 2013) adjusted by line 10 or line 7 (Revision 2011-2012), or line 7d for( Revision 2010) adjusted by line 8.
    Line 11 (Revision 2017, 2016, 2015, 2014, 2013) or line 9 (Revision 2012) is blank, "none" etc. or contains a misapplied entry,
    1. Line 9 (Revision 2017, 2016, 2015, 2014, 2013) adjusted by line 10 or line 7 (Revision 2011 - 2012, or line 7d for Revision 2010) adjusted (+ or -) by line 8, and enter the amount on line 11 (Revision 2017, 2016, 2015, 2014, 2013) or line 9 (Revision 2009-2012).

    2. For tax periods 201012 and prior- If line 10 is blank, enter the Line 11 amount on Line 9.

Line 12, Qualified small business payroll tax credit for increasing research activities. Attach Form 8974...

  1. Process Line 12 as follows:

    IF AND THEN
    Line 12 is blank Form 8974 is attached
    1. Consider the F8974 as a loose Form.

    2. Detach the F8974 and Route to your local Image Control Team (ICT).

    3. Continue processing the return.

    There is an entry on Line 12 Form 8974 is attached Edit CCC Q bottom center margin.
    There is an entry on Line 12 Form 8974 is not attached. Edit Action Code 211 and correspond using Letter 21C paragraph S to request the F8974.
    Line 12 and Line 11 have the same amount   Delete Line 12 as a misplaced entry.
    The entry on Line 12 does not match the entry on Line 12 Form 8974.   Edit an asterisk (*) to the left of the amount on Line 12 and enter the amount from Line 12 Form 8974 to Line 12 Form 943, 943-PR.
    The entry on Line 12 is more than Line 11 Line 13 and Line 14 are blank
    1. Determine the difference between the amount on Line 11, Total taxes after adjustments and the taxpayer entry on Line 12, payroll tax credit,

    2. Add the calculated amount to the taxpayers entry on Line 13, Total taxes after adjustment and credits,

    3. Edit the overpayment amount from Line 13, Total taxes after adjustment and credits to Line 14, Total deposits for 2017, including overpayment (Do not use the parentheses brackets)

    The taxpayer has used Form 943 Revision 2017 for tax year 2016 or prior There is an entry on Line 12
    1. Delete the amount on Line 12 as a misplaced entry and edit the amount to Line 14 as Total Deposits if not already there,

    2. Re-compute Line 13 if necessary

Line 13, Total Taxes after adjustments and credits. Subtract line 12 from line 11...

  1. Line 13 is a T-Line. Process Line 13 as follows:

    IF THEN
    Line 13 is blank ,zero, dash or none Subtract line 12 from Line 11 and enter the amount on Line 13.
    Lines 12 and 13 have the same amount Delete Line 12 as a misplaced entry.

Line 10, Advance Earned Income Credit (AEIC)- (Revision 2010 and prior) (Domestic Only)

  1. The Advanced Earned Income Credit (AEIC) is a tax credit for certain workers in the United States. Eligible employees can choose whether to claim all of the credit on their tax return (Form 1040) or to receive part of the credit in advance with their pay during the year and claim the remainder of the credit on their tax return. The employer may or may not have to make a tax deposit during the quarter. Therefore, do not assume that AEIC is a misplaced entry if there is no deposit(s). This largely applies to small dollar returns. If the Total Taxes minus the AEIC equals the Net Taxes do not move the AEIC entry. See Figure 3.11.13-47.

    Figure 3.11.13-47

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  2. Effective January 1, 2011, there is no longer distribution of advanced earned income credit (EIC) through the employer. Eligible employees can still claim earned income credit on their Form 1040 provided they meet certain EIC requirements.

  3. Process a Line 10 entry (Revision 2010 and prior) as follows:

    IF THEN
    The tax year of the Form 943 began after December 31, 2010, Place an asterisk (*) to the left of the amount. This will cause the return to fall out to ERS for correction.
    The Line 10 entry appears to be other than for Advance Payment of Earned Income Credit (EIC), (e.g., The total taxes are entered on the incorrect line, or Net Taxes entered on Line 11 rather than Line 12, etc.),
    1. Review the return to determine if there is an incorrect line entry,

    2. If so, asterisk (*) to the left of the amount and, if needed, edit the entry to the correct line,

    3. If the entry is correct, but should not have parenthesis or brackets, edit an asterisk to the left of the entry and edit to the left of the asterisk as a positive amount.

    Line 10 shows the correct entry, but the amount is larger than the entry on Line 9, Total Taxes,
    1. Asterisk (*) to the left of the amount on Line 10. To the left, edit the same amount appearing on Line 9, Total Taxes,

    2. Determine the difference between the amount on Line 9, Total Taxes and the taxpayer's entry on Line 10, AEIC,

    3. Add the calculated amount to the taxpayer's entry on Line 12, Total deposits for the quarter. Edit the new amount to the left of Line 12.

Line 10, Total Deposits (Revision 2011-2012), Line 11a, COBRA Assistance Payments (Revision 2011-2012), Line 11b, Number of COBRA Recipients— (Revision 2011-2012)
Line 12, Total Deposits (Revision 2016, 2015, 2014, 2013, 2010 and prior), Line 13a, COBRA Assistance Payments, and
Line 13b, Number of COBRA Recipients— (Revision 2009, 2010 and 2013)
Line 14, Total Deposits for 2017, including overpayment applied from a prior year and Form 943-X (Revision 2017),

  1. Consolidated Omnibus Budget Reconciliation Act (COBRA) gives employees who lose coverage under the employer's group health plan, due to a qualifying event, the right to elect to continue that coverage (under COBRA) for a period of time by paying premiums. COBRA covers multi-employer health plans and health plans maintained by private sector employers with 20 or more employees. It does not apply to churches or certain religious organizations.

  2. The COBRA lines will not be processed beginning with tax year 2014. The Lines 13a, 13b and 14 will remain on Form 943 but the text for these lines will be removed.

  3. The American Recovery and Reinvestment Act of 2009 and subsequent legislation provides for premium assistance for individuals and their families (referred to as "assistance eligible individuals" ) who lose employer health coverage to continue under COBRA coverage. The premium assistance also applies to temporary continuation coverage elected under the Federal Employees Health Benefits Program and to continuation coverage under State programs that provide for coverage comparable to COBRA continuation coverage. The COBRA premium assistance credit is not available for individuals who were involuntarily terminated after May 31, 2010. Therefore, only in rare circumstances, such as instances where COBRA eligibility was delayed as a result of employer-provided health insurance coverage following termination, will the credit be available. To be eligible, certain conditions must be met:

    1. Any loss of employer health overage by the employee or their family must be due to involuntary termination of employment.

    2. The loss of employer health coverage must have taken place between September 1,2008 and May 31, 2010.

    3. The federal subsidy must not exceed 65% of the COBRA premium and the remaining 35% must be paid by the assistance eligible individual. The 65% of the premium not paid by the assistance eligible individual is reimbursed to the employer maintaining the group health plan through a credit against payroll taxes. The credit is treated as a deposit made on the first day of the return period which reduces the employer's employment tax liabilities. Employers can apply the credit to offset their federal tax deposits, to generate a refund, or both.

    4. For tax periods beginning after Dec. 31, 2013, an employer who files Form 943, Employer’s Annual Federal Tax Return for Agricultural Employees, must file Form 943-X, Adjusted Employer’s Annual Federal Tax Return for Agricultural Employees or Claim for Refund, to get reimbursed for the COBRA premium assistance payments that it has provided to assistance eligible individuals.

    5. The federal subsidy for the assistance eligible individual must not exceed 15 months from the initial date of COBRA coverage.

  4. Process Line 10 through 11b (Revision 2011 and 2012) or Line 12 through 13b (Revision 2009, 2010, 2013, 2014, 2015 or 2016) or Line 14 (Revision 2017) as follows:

    IF AND THEN
    Line 10 (Revision 2011-2012, or line 12, Revision 2009, 2010, 2013, 2014, 2015 and 2016,) or Line 14 (Revision 2017) is blank, Taxpayer indicates on attachment their total deposits Edit the amount to Line 10 (Revision 2011 - 2012, or line 12, Revision 2009, 2010, 2013, 2014, 2015 and 2016) or to Line 14 (Revision 2017)
    Line 10 (Revision 2011 -2012, Line 12, Revision 2009, 2010, 2013, 2014, 2015, r 2016) or Line 14 (Revision 2017) shows an amount,   Accept taxpayer's figures
    An amount is shown on Line 11a (Revision 2011-2012) or Line 13a (Revision 2009, 2010 or 2013) that is equal to the amount on Line 9, Line 10 (Revision 2011-2012) or Line 12 (Revision 2009, 2010 or 2013) is blank, zero, dash or "none"
    • Edit an asterisk to the left of Line 11a (Revision 2011-2012) or Line 13a (Revision 2009, 2010 or 2013)

    • Edit the amount from Line 11a (Revision 2011-2012) or Line 13a (Revision 2009, 2010 or 2013) to Line 10 (Revision 2011-2012) or to Line 12 (Revision 2009, 2010 or 2013)

    • Also edit the Line 11a (Revision 2011-2012) or Line 13a (Revision 2009, 2010 or 2013) amount to Line 12( Revision 2011-2012) or Line 14 (Revision 2009, 2010 or 2013) if blank

    Line 11a (Revision 2011 -2012, or Line 13a Revision 2009, 2010 or 2013) is blank, Line 11b (Revision 2011-2012, or Line 13b, (Revision 2009, 2010 or 2013) has an entry other than zero, dash or none Correspond for Line 11a (Revision 2011-2012, or line 13a, Revision 2009, 2010 or 2013).
    Line 11b (Revision 2011-2012, or Line 13b Revision 2009, 2010 or 2013) is blank, Line 11a (Revision 2011-2012, or Line 13a, (Revision 2009, 2010 or 2013) has an entry other than zero, dash or none Correspond for Line 11b (Revision 2011-2012, or line 13b, Revision 2009, 2010 or 2013).
    Line 11b (Revision 2011-2012, or Line 13b, Revision 2009, 2010 or 2013) is the same number shown on Line 1, there is no entry on Line 11a (Revision 2011-2012, or Line 13a, Revision 2009, 2010 or 2013) Asterisk to the left of the amount shown on Line 11b (Revision 2011-2012, or Line 13b, Revision 2009, 2010 or 2013)

Line 13c, 13d and 13e, Form 943 and 943-PR (Revision 2010 only)

  1. Lines 13c, 13d and 13e are all transcription lines for 2010. Accept taxpayers figures.

Line 12, Subtotal, Line 13, Balance Due, and Line 14, Overpayment (Revision 2011-2012)
Line 14, Subtotal, Line 15, Balance Due, and Line 16, Overpayment (Revision 2009, 2010, 2013, 2014, 2015, 2016 and 2017)

  1. Process Line 12 and 13 (Revision 2011-2012, Line 14 and 15, Revision 2009, 2010, 2013, 2014, 2015, 2016 and 2017) as follows: Note: Line references refer to Form 943, Revision 2009 and Subsequent as indicated.

    IF AND THEN
    Line 12 (Revision 2011 -2012, or Line 14, Revision 2009, 2010 and 2013) is blank, zero, dash or "none"  
    • Revision 2013- Add Lines 12, and 13a and edit the result to Line 14 (Revision 2013)

    • Revision 2011 and 2012- Add Lines 10 and 11a and edit the result to Line 12 (Revision 2011- 2012).

    • Revision 2010,- Add Lines 12, 13a, and 13e and edit the result to Line 14.

    • Revision 2009 - Add Lines 12 and 13a and edit the result to Line 14.

    Revision 2009, 2010 and 2013 Line 12 and 14 are the same amount Revision 2009, 2010 and 2013 Are the same amount as Line 11 and 15 Revision 2009, 2010 and 2013- Consider Lines 12 and 14 as misplaced entries and asterisk (*) to the left of the entries.
    Line 13 and 14 (Revision 2011- 2012, or Line 15 and 16 Revision 2009, 2010, 2013, 2014, 2015 , 2016 and 2017) are blank, zero, dash or "none" , Line 12 (Revision 2011- 2012, 2014, 2015, 2016) or Line 14, Revision 2009, 2010, 2013, 2017) have different entries,
    • Revision 2011- 2012 - Edit Line 9 to Line 13.

    • Revision 2009, 2010, 2013, 2014, 2015, and 2016-- Edit Line 11 amount to Line 15.

    • Revision 2017 Edit Line 13 to Line 15

    Line 13 and 14 (Revision 2011- 2012, or Line 15 and 16 Revision 2009, 2010, 2013, 2014, 2015 2016 and 2017) are blank, zero, dash or none,
    • Revision 2017 Line 13 is more than the amount on Line 14

    • Revision 2014-2015, 2016 Line 11 is more than the amount on Line 12

    • Revision 2011- 2012 Line 9 is more than the amount on Line 12

    • Revision 2009, 2010 , and 2013 Line 11 is more than the amount on Line 14,

    • Revision 2017 Subtract Line 14 from Line 13 and enter the result on Line 15

    • Revision 2014-2015, 2016 Subtract Line 12 from Line 11 and enter the amount on Line 15.

    • Revision 2011- 2012 Subtract 12 from Line 9 and enter the result on Line 13.

    • Revision 2009, 2010, and 2013 Subtract Line 14 from Line 11 and enter the amount on Line 15. See Figure 3.11.13-48.

    Line 13 and 14 (Revision 2011- 2012, or Line 15 and 16 Revision 2009, 2010, 2013, 2014, 2015 2016 and 2017) are blank, zero, dash or none,
    • Revision 2017 Line 14 is more than Line 13

    • Revision 2014-2015, 2016 Line 12 is more than Line 11

    • Revision 2011- 2012 Line 12 is more than Line 9

    • Revision 2009, 2010 and 2013– Line 14 is more than the amount on Line 11,

    • Revision 2017 Subtract Line 13 from Line 14 and enter the amount on Line 16

    • Revision 2014-2015, 2016 Subtract Line 11 from Line 12 and enter the amount on Line 16.

    • Revision 2011 - 2012 Subtract Line 9 from Line 12 and enter the amount on Line 14.

    • Revision 2009, 2010 and 2013– Subtract Line 11 from Line 14 and enter the amount on Line 16.

    There are entries on both:
    • Revision 2017 Line 15 and Line 16, and Line 13 equals Line 17, Total Liability for the Quarter,

    • Revision 2011 -2012 Lines 13 and 14, and Line 9 equals Line 15, Total Liability for the Quarter,

    • Revision 2009, 2010, 2013, 2014, 2015 and 2016- Line 15 and Line 16, and Line 11 equals Line 17, Total Liability for the Quarter,

    • Revision 2017 and Line 13 is more than Line 14

    • Revision 2014-2015, 2016 Line 11 is more than Line 12

    • Revision 2011 -2012 Line 9 is more than Line 12,

    • Revision 2009, 2010 and 2013- Line 11 is more than Line 14.

    • Revision 2011- 2012 Edit an asterisk (*) to the left of the incorrect entry on Line 14.

    • Revision 2009, 2010, 2013, 2014, 2015, 2016 and 2017- Edit an asterisk (*) to the left of the incorrect entry on Line 16.

    There are entries on both:
    • Revision 2011 -2012 Lines 13 and 14, and Line 9 equals Line 15, Total Liability for the Quarter,

    • Revision 2009, 2010, 2013, 2014, 2015 and 2016- Line 15 and Line 16, and Line 11 equals Line 17, Total Liability for the Quarter,

    • Revision 2017 Line 15 and Line 16, and Line 13 equals Line 17, Total Liability for the Quarter

    • Revision 2014-2015, 2016 Line 12 is more than Line 11

    • Revision 2011 - 2012 Line 12 is more than Line 9,

    • Revision 2009, 2010 and 2013- Line 14 is more than the amount on Line 11

    • Revision 2017 Line 14 is more than Line 13

    • Revision 2011- 2012 Edit an asterisk (*) to the left of the incorrect entry on Line 13.

    • Revision 2009, 2010, 2013, 2014, 2015 , 2016 and 2017 Edit an asterisk (*) to the left of the incorrect entry on Line 15. See Figure 3.11.13-49

    • Revision 2017 The entry on Line 15 belongs on Line 16 and the amount on Line 14 is more than the amount on Line 13

    • Revision 2014-2015, 2016 The entry on Line 15 belongs on Line 16 and the amount on Line 12 is more than the amount on Line 11

    • Revision 2011 - 2012 The entry on Line 13 belongs on Line 14 and the amount on Line 12 is more than the amount on Line 9,

    • Revision 2009, 2010 and 2013- The entry on Line 15 belongs on Line 16 and the amount on Line 14 is more than the amount on Line 11,

    • Revision 2014-2015, 2016, 2017 The taxpayer indicates a refund by placing parenthesis around the Line 15 amount or by checking the "Refund" box or "Apply to next return" box,

    • Revision 2011 - 2012 The taxpayer indicates a refund by placing parenthesis around the Line 13 amount or by checking the "Refund" box or "Apply to next return" box,

    • Revision 2009, 2010 and 2013- The taxpayer indicates a refund is due by placing parenthesis around the Line 15 amount or by checking the "Refund" box or "Apply to next return" box,

    Revision 2011- 2012 Edit an asterisk (*) to the left of the amount on Line 13 and edit the amount to Line 14.
    Revision 2009, 2010, 2013, 2014, 2015, 2016 and 2017 Edit an asterisk (*) to the left of the amount on Line 15 and edit the amount to Line 16.
    • Revision 2017 A negative amount is shown on Line 15 or 16 and an entry is shown on Line 13

    • Revision 2014-2015, 2016 A negative amount is shown on Line 15 or 16 and an entry is shown on Line 11

    • Revision 2011 - 2012 A negative amount is shown on Line 13 or 14 and entries are shown on Line 9 and/or 12

    • Revision 2009, 2010 and 2013- A negative amount is shown on Line 15 or 16 and entries are shown on Line 11 and/or 14,

    • Revision 2017 Line 14 is blank, zero, dash or none,

    • Revision 2011- 2012, 2014, 2015 and 2016 If Line 12 is blank, zero, dash or none,

    • Revision 2009, 2010 and 2013– If Line 14 is blank, zero, dash or "none" ,

    • Revision 2017 Edit Line 13 to Line 14

    • Revision 2014- 2015, 2016 Edit Line 11 amount to Line 12

    • Revision 2011- 2012 Edit Line 9 amount to Line 12

    • Revision 2009, 2010 and 2013– Edit the Line 11 amount to Line 14.

    • Revision 2017 A negative amount is shown on Line 15 or 16 and an entry is shown on Line 13

    • Revision 2014-2015, 2016 A negative amount is shown on Line 15 or 16 and an entry is shown on Line 11

    • Revision 2011 - 2012 A negative amount is shown on Line 13 or 14 and entries are shown on Line 9 and/or 12

    • Revision 2009, 2010 and 2013- A negative amount is shown on Line 15 or 16 and entries are shown on Line 11 and/or 14,

    • Revision 2017 Line 13 is more than the amount on Line 14

    • Revision 2014- 2015, 2016 Line 11 is more than the amount on Line 12

    • Revision 2011- 2012 Line 9 is more than Line 12,

    • Revision 2009, 2010 and 2013- Line 11 is more than the amount on Line 14,

    • Revision 2017 Subtract Line 14 from Line 13 and enter the amount on Line 15

    • Revision 2014-2015, 2016 Subtract Line 12 from Line 11 and enter the amount on Line 15

    • Revision 2011- 2012 Subtract Line 12 from Line 9 and enter the amount on Line 13

    • Rev 2009, 2010 and 2013– Subtract Line 14 from Line 11 and enter the amount on Line 15.

    • Revision 2017 A negative amount is shown on Line 15 or 16 and an entry is shown on Line 13

    • Revision 2014-2015, 2016 A negative amount is shown on Line 15 or 16 and an entry is shown on Line 11

    • Revision 2011 - 2012 A negative amount is shown on Line 13 or 14 and entries are shown on Line 9 and/or 12

    • Revision 2009, 2010 and 2013- A negative amount is shown on Line 15 or 16 and entries are shown on Line 11 and/or 14,

    • Revision 2017 Line 14 is more than the amount Line 13

    • Revision 2014-2015, 2016 Line 12 is more than the amount on Line 11

    • Revision 2011- 2012 Line 12 is more than the amount on Line 9,

    • Revision 2009, 2010 and 2013- Line 14 is more than the amount on Line 11,

    • Revision 2017 Subtract Line 13 from Line 14 and enter the amount on Line 16.

    • Revision 2014-2015, 2016 Subtract Line 11 from Line 12 and enter the amount on Line 16.

    • Revision 2011- 2012 Subtract Line 9 from Line 12 and enter the amount on Line 14

    • Revision 2009, 2010 and 2013- Subtract Line 11 from Line 14 and enter the amount on Line 16.

    Figure 3.11.13-48

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    Figure 3.11.13-49

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    Please click here for the text description of the image.

Monthly Summary of Federal Tax Liability— Line 15, (Revision 2011- 2012),
Line 17, (Revision 2009, 2010, 2013, 2014, 2015, 2016 - 2017
Line 15, (Revision 2008 and Prior) and
Form 943–A (ROFTL)- Schedule Indicator Code (SIC)

  1. When Line 13 (Revision 2017) or Line 11 (Revision 2009, 2010, 2013, 2014, 2015, 2016 ) or Line 9, Total Taxes, (Revision 2008 and prior and Revision 2011- 2012) shows $2,500.00 or more, the taxpayer is required to complete a Record of Federal Tax Liability (ROFTL). Depending on their tax liability in previous years, the taxpayer should complete Line 15 (Revision 2008 and prior, and 2011- 2012, or Line 17, Revision 2009, 2010, 2013, 2014, 2015, 2016 and 2017), Monthly Summary of Federal Tax Liability, or Form 943-A, Agricultural Employer's Record of Tax liability. The taxpayer will indicate in the check boxes between Line 14 and 15, (Revision 2008 and prior and 2011 - 2012, or Lines 16 and 17, Revision 2009, 2010, 2013, 2014, 2015, 2016 and 2017) which ROFTL they are to complete.

  2. The Schedule Indicator Code (SIC) is used by Code and Edit to remove the requirement for data entry to capture the ROFTL information when it is determined the ROFTL is unnecessary incomplete or outside of the tolerance.

  3. When determining whether a SIC code should be edited,

    IF THEN
    Revision 2017
    1. Use Line 13.

    2. If Lines 12 and 13 are blank, use Line 11

    3. If Line 11 is blank, but line 10 contains an entry, compute line 13 by combining lines 9, 10 and 12.

    Revision 2016, 2015, 2014, 2013, 2010 or 2009
    1. Use Line 11.

    2. If Lines 10 and 11 are blank, use Line 9

    3. If Line 11 is blank, but line 10 contains an entry, compute line 11 by combining lines 9 and 10.

    Revision 2008, 2011- 2012
    1. Use Line 9.

    2. If Lines 8 and 9 are blank, use Line 7

    3. If Line 9 is blank, but line 8 contains an entry, compute line 9 by combining lines 7 and 8.

  4. If a SIC needs to be entered on the return, edit the applicable SIC in the right margin, at the end of Line 1, "Number of agricultural employee employed...." (Form 943 and Form 943-PR).

    SCHEDULE INDICATOR CODE (SIC) CHART

    SIC CODE CONDITIONS
    1 Edit SIC 1 when:
    1. Line 13 (Revision 2017), Line 9 (Revision 2011- 2012 ) or Line 11 (Revision 2009, 2010, 2013, 2014, 2015, 2016 ) is less than $2,500.00

    2. Line 13 (Revision 2017), Line 9 (Revision 2011- 2012 ), or Line 11 (Revision 2009, 2010, 2013, 2014, 2015, 2016 and 2017) is$2,500.00 or more and the ROFTL is incomplete or blank,

    3. The return shows all zeros or is non-taxable.

    4. A negative or minus (-) amount appears in the ROFTL (Form 943 Line 15, Revision 2008 and prior, or Revision 2011- 2012, or Line 17, Revision 2009, 2010, 2013, 2014, 2015, 2016 and 2017 ).

    5. Return prepared under IRC 6020(b).


    Note: If the taxpayer completed both the Line 15, Revision 2008 and prior, or Revision 2011- 2012, or Line 17, Revision 2009, 2010, 2013 2014, 2015, 2016 and 2017 ROFTL and Form 943-A, only edit SIC 1, if BOTH are not to be entered by ISRP.
    2 A statement of "Unbanked Taxpayer" is attached, (Line 13 (Revision 2017) or Line 9 (Revision 2011-2012) or Line 11 (Revision 2009, 2010, 2013 and subsequent) is $2,500.00 or more,

    Note:

    Edit SIC “1”, not “2” if Line 13 (Revision 2017), Line 9 (Revision 2011-2012) or Line 11 (Revision 2009, 2010, 2013 and subsequent) is less than $2500

     

Perfecting Line 15, (Revision 2008 and prior, or 2011- 2012) or
Line 17 (Revision 2009, 2010, 2013, 2014, 2015, 2016 - 2017) and Form 943-A (any year)

  1. If Line 13 (Revision 2017) or Line 11 (Revision 2009, 2010, 2013, 2014, 2015, 2016) is less than $2,500.00, Line 17A through 17M or Form 943-A do not need to be completed or Line 11 (Revision 2008 or prior) is less than $2,500.00 lines 15A through M or Form 943-A do not need to be completed.

  2. If Line 13 (Revision 2017) or Line 11( 2009, 2010, 2013, 2014, 2015, 2016) is more than $2,500.00, perfect Line 15 (Revision 2008 and prior or 2011 - 2012, or Line 17, Revision 2009, 2010, 2013, 2014, 2015, 2016- 2017) or Form 943-A as follows:

    IF THEN
    The taxpayer has completed both, Line 15 (Revision 2008 and prior or 2011- 2012, or Line 17, Revision 2009, 2010, 2013, 2014, 2015, 2016 - 2017) "A" through "M" and Form 943-A,
    • ISRP will pick up both entries and Master File (MF) will determine the correct entry.

    • If a negative or minus (-) amount appears on Form 943, Line 15 (Revision 2008 and prior or 2011- 2012, or Line 17, Revision 2009, 2010, 2013, 2014, 2015, 2016 - 2017), A through M, or Form 943-A, line through the ROFTL with the negative or minus (-) to ensure it will not be captured.

    Form 943, Lines 15A through 15L, (Revision 2008 and prior or 2011- 2012, or Line 17A through 17L, Revision 2009, 2010, 2013, 2014, 2015, 2016 - 2017), are blank but Form 943-A has only monthly amounts,
    1. Edit the monthly totals from 943-A to the applicable monthly line(s) of the ROFTL i.e. Line 15 (Revision 2008 and prior or 2011- 2012, or Line 17, Revision 2009, 2010, 2013, 2014, 2015, 2016 - 2017).

    2. Line through "(/)" the Forms 943–A.

    The taxpayer completes more than one Form 943-A, Then combine the Daily Tax Liabilities from each Form 943-A to one Form 943-A and "/" (line through) the Forms 943-A that are not to be entered.
    The taxpayer does not complete the ROFTL area of Form 943, but completes an attachment in the same format as the ROFTL or the Form 943-A, Put the attachment or Form 943-A immediately behind the Form 943. Do not write the taxpayers figures in the ROFTL area.
    Form 943, Lines 15A through 15L, (Revision 2008 and prior or 2011- 2012, or Line 17A through 17L, Revision 2009, 2010, 2013, 2014, 2015 and 2016) are entered, but Line 15M (or Line 17M (Revision 2009, 2010, 2013, 2014, 2015, 2016 and 2017) is blank, Total the Lines 15A through 15L, (or Lines 17A through 17L) and enter the result on Line 15M (or Line 17M)
    Form 943-A shows an entry for a day which is not in that month (e.g., an entry for February 29th and it is not a leap year),
    1. Asterisk (*) to the left of the entry,

    2. Enter the amount to the last valid day of the month,

    3. If an entry already exists in the field, add the amounts together, edit an asterisk (*) to the left of the taxpayer's entry and enter the resulting amount. (An exception would be more than one entry on the same line, add figures together and put total to left of line).

  3. Combine multiple deposits shown on the same line and enter the correct amount to the left of the asterisk (*).

Form 944, Employer's ANNUAL Federal Tax Return,

  1. Beginning with Tax Year 2017 line 8 was added to ask taxpayers to provide the qualified small business payroll tax credit for increasing research activities from Form 8974 , Line 9 now asks for total taxes after adjustments and credits and Line 10 is now total deposits.

  2. The COBRA lines will not be processed beginning with tax year 2014. Lines 9a, 9b and 10 will remain on Form 944, but the text for the lines will be removed and a gray shaded area will be inserted with the words "Reserved" .

  3. Beginning with tax year 2013 line 4d was added to report "Taxable wages and tips subject to Additional Medicare Tax Withholding" at 0.9% (.009) of wages /tips. Section 3101 (b)(2), as added by P.L. 111-148, sections 9015 and 10906, and further amended by section 1402(b) of P.L. 111-152 (collectively known as the "Affordable Care Act" .

  4. Form 944 may be filed annually by taxpayers with a tax liability of $1,000 or less. The purpose of the annual filing option is to reduce the burden for the smallest of the small business taxpayers. See Exhibit 3.11.13-6 for Form 944; These forms are processed through ISRP only.

  5. The following types of taxes are reported on a Form(s) 944

    • Income Tax Withholding (Form 944 only).

    • Social Security Tax

    • Medicare Tax

  6. Domestic and Foreign consideration of Form 944:

    1. Domestic Form 944- An employer whose principal place of business is in one of the 50 states or the District of Columbia.

    2. Foreign Form 944- Form 944 with a foreign (international) address: An employer whose principal place of business is in one of the 50 states or the District of Columbia, but they employ individuals in Puerto Rico, American Samoa, Guam, the Commonwealth of the Northern Mariana Islands, or the U.S. Virgin Islands (OSPC ONLY WITH A FOREIGN ADDRESS ).

  7. Foreign Return Processing:

    1. See IRM 3.11.13.13.7 for foreign address processing.

    2. All Forms 944 with a foreign address or an address of an U.S. possession should be processed at the Ogden Submission Processing Campus (OSPC). If these returns are received in any other Submission Processing Campus, they must be transshipped to OSPC. APO, DPO and FPO are not considered foreign addresses.
      • If the return is unnumbered, withdraw it from the batch and prepare Form 13195 requesting the Letter 86C be sent to the taxpayer. Attach a Form 4227 for routing to OSPC.
      • If the return is numbered, use AC 650.

    3. Form 944-PR and Form 944-SS were discontinued beginning in tax year 2012. For tax year 2011 and prior withheld Income Tax should not be reported on Forms 944-PR, or Form 944-SS returns. However, certain filers may have employees who are subject to income tax withholding. If such filers include income tax withholding and/or income tax withholding adjustments on Form 944-PR or Form 944-SS convert these returns to Form 944.

      Note:

      The following procedures will change the Filing Requirement from a Form 944-PR, or Form 944-SS, to a Form 944 filer. Care should be taken before entering this change:
      • Code a numbered return with AC 620 for Reject processing.
      • Prepare a substitute return for the erroneous foreign return if the return is unnumbered.
      • Prepare and release promptly a Form 2363, (Master File Entity Change), to change the BMF filing requirement code from "6" or "7" to "1" .

    4. Otherwise, the instructions provided for Form 944 returns filed with foreign or U.S. Possession addresses should be followed to the extent possible to process these returns. Specific procedures for these returns are:
      • An address change may be made on the returns if it will not change the Filing Requirement Code from "6" to "7" or "1" , or from "7" to "1" or "6" . Otherwise, a Form 2363 must be prepared showing TC 013.
      • See IRM 3.11.13.13.1 for instructions to follow regarding the Name Control and see the Name Control Job Aid, Document 7071A, for determining a Name Control.

  8. Form 944 returns that have been early filed before the end of the year (e.g., tax year (TY) 2018 returns filed on or before December 31, 2018) must be held until the first cycles of the next year (2019). Edit Action Code 480 and continue to process the return.

  9. Non-payroll items should be reported on Form 945, Annual Return of Withheld Federal Income Tax. See IRM 3.11.13.22 for more information. Non-Payroll items include:

    • Backup Withholding,

    • Pensions and Annuities,

    • Gambling Winnings,

    • IRAs and 401K,

    • Military Pensions,

  10. This table mainly applies to domestic 944 returns.

    IF AND THEN
    There are entries on Lines 2, 7, 10 and 11 (Revision 2017) or 2, 7, 8, and 11 (Revision 2011-2016, or 2, 7, 9, 10 and 13, Revision 2010 and prior) or only Line 1, There is an indication the taxpayer is filing for Non-Payroll Item (e.g., the entity name contains such references as Employee Pension Plan, Pension, 401K Plan, Profit Sharing Plan, Retirement Fund, Lottery, IRAs, Annuity, etc.),
    1. Correspond to determine the taxpayer's intent,

    2. If the taxpayer's reply indicated they should have reported the entries on a Form 945, route the Form 944 to Accounts Management (AM) on Form 3465 with a notation "Non-Payroll on Form 944" .

    Note:

    This procedure will advise Accounts Management (AM) to delete the filing requirement for the Form 944 and establish a new filing requirement for Form 945 and to post any payment(s) to the correct module (e.g., Form 945 tax period) and to return the Form 944 to the taxpayer, with a letter explaining how they must now report their tax.

    Caution:

    If it can be determined the taxpayer has a "Non-Qualified Plan" , correspond with the taxpayer explaining that it was a wage deferred plan subject to wage withholding and must be reported on Form 941. For an explanation of Non-Qualified Plan, See (11) below.

  11. Non-Qualified Plans - Certain companies (for example, Life Insurance Companies) sell annuity contracts to participants in "non-qualified" plans or deferred compensation plans. Distribution of these contracts are payments of deferred wages subject to withholding and reportable on Form W-2 and Form 944.

    1. If the taxpayer notes a Form 944 in the left margin, or you are able to determine that it is a "non-qualified plan" , edit a CCC "B" on the return and continue to process.

Form 944, Return Perfection and Line Editing

  1. See IRM 3.11.13.13 for entity perfection procedures.

  2. While Form 944 (Domestic and Foreign) is the annualized employer's federal tax return, there are some significant differences between Form 944 (Domestic and Foreign). The table below compares Form 944 (Domestic and Foreign) for tax years 2010, 2011, 2012, 2013, 2014, 2015 , 2016 and 2017:

    Line Item Description Form 944 (Revision 2010) Form 944 (Revision 2011) Form 944 (Revision 2012) Form 944 (Revision 2013) Form 944 (Revision 2016, 2015-2014) Form 944 (Revision 2017
    Wages, tips, and other compensation Line 1 Line 1 Line 1 Line 1 Line 1 Line 1
    Total income tax withheld form wages, tips, and other compensation Line 2 Line 2 Line 2 Line 2 Line 2 Line 2
    If no wages, tips, and other compensation are subject to social security or Medicare tax Line 3 Line 3 Line 3 Line 3 Line 3 Line 3
    Taxable social security and Medicare wages and tips Line 4 Line 4 Line 4 Line 4 Line 4 Line 4
    Taxable social security wages Line 4a Line 4a Line 4a Line 4a Line 4a Line 4a
    Taxable social security tips Line 4b Line 4b Line 4b Line 4b Line 4b Line 4b
    Taxable Medicare wages and tips Line 4c Line 4c Line 4c Line 4c Line 4c Line 4c
    Taxable wages and tips subject to Additional Medicare Tax withholding       Line 4d Line 4d Line 4d
    Total social security and Medicare taxes Line 4d Line 4d Line 4d      
    Add Column 2 from lines 4a, 4b, 4c, and 4d       Line 4e Line 4e Line 4e
    Qualified employees paid exempt wages Line 5a          
    Exempt wages/tips paid to qualified employees (after 03/31/2010) Line 5b          
    Total taxes before adjustments Line 5d Line 5 Line 5 Line 5 Line 5 Line 5
    Current year's adjustments Line 6 Line 6 Line 6 Line 6 Line 6 Line 6
    Total taxes after adjustments Line 7 Line 7 Line 7 Line 7 Line 7 Line 7
    Qualified small business payroll tax credit for increasing research activities. Attach Form 8974.           Line 8
    Advanced earned income credit (AEIC) payments made to employees Line 8          
    Total taxes after adjustments and credits. Subtract line 8 from line 7.           Line 9
    Total taxes after adjustment for advance EIC Line 9          
    Total deposits for this year, including overpayment applied from prior year (PY) and overpayment applied Form 944-X, Form 944-XPR, Form 941-X, or Form 941-X(PR) Line 10 Line 8 Line 8 Line 8 Line 8 Line 10
    COBRA Premium assistance payments Line 11a Line 9a Line 9a Line 9a Line 9a (Reserved)  
    Number of individuals provided COBRA premium assistance reported on Line 9b (Revision 2011 and subsequent), or Line 11a (Revision 2010 and prior) Line 11b Line 9b Line 9b Line 9b Line 9b (Reserved)  
    Number of qualified employees paid exempt wages 03/19–03/31 Line 11c          
    Exempt wages for 03/19–03/31 Line 11d          
    Exempt social security tax for 03/19–03/31 Line 11e          
    Add:
    • Revision 2011 and subsequent - Lines 8 and 9a

    • Revision 2010- Lines 10, 11a and 11e,

    Line 12 Line 10 Line 10 Line 10 Line 10 (Reserved)  
    Balance Due Line 13 Line 11 Line 11 Line 11 Line 11 Line 11
    Overpayment Line 14 Line 12 Line 12 Line 12 Line 12 Line 12
    Month ROFTL Line 15a -15l Line 13a- 13l Line 13a- 13l Line 13a-13I Line 13a-13I Line 13a-13I
    State deposit code Line 16 Line 14        
    Final return check box Line 17 Line 15 Line 14 Line 14 Line 14 Line 14
    Seasonal employer box Does not apply Does not apply Does not apply Does not apply    
    Third Party Designee Part 4 Part 4 Part 4 Part 4 Part 4 Part 4
    Sign here Part 5 Part 5 Part 5 Part 5 Part 5 Part 5
    For paid preparer only Part 5 Part 5 Part 5 Part 5 Part 5 Part 5
  3. ISRP is capable of processing Form 944 returns filed on a Revision 2010, 2011, 2012, 2013, 2014, 2015, 2016 or 2017 return. Therefore, all Form 944 returns filed, with revision 2009 and prior, require conversion to a 2010 revision. The table below shows the lines on Revisions year 2008 and prior, or year 2009, which will need to be converted to 2010 revision.

    Form 944, Revision 2009  
    Line 5 Renumber to Line 5d
    For Lines 8 and 9, review tax year of return:
    • If the tax year is 2011 or subsequent-"X" any entry on Lines 8 and 9.

    • If the tax year is 2010 and prior-accept the taxpayer's entry.

     
    Form 944, Revision 2008 and prior